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Australia New Zealand Society

for Ecological Economics

Opportunities for the Critical Decade:
Enhancing well-being within Planetary
2013 Conference Proceedings
Edited By Alex Y Lo, Leonie J Pearson and Megan C Evans

Australia New Zealand Society for Ecological Economics

2013 Conference Proceedings

Opportunities for the Critical Decade:
Enhancing well-being within Planetary Boundaries

Edited By
Alex Y Lo, Leonie J Pearson and Megan C Evans


The Australia and New Zealand Ecological Economics 2013 conference proceedings
titled Australia New Zealand Society for Ecological Economics: Opportunities for the
Critical Decade: Enhancing well-being within planetary boundaries, is a fully refereed
(double-blind, peer reviewed) and open access. The conference was held at the
Crawford School of Public Policy, Australian National University, Canberra, Australia,
11-14 November 2013.
Conference Proceedings edited by: Alex Y Lo (Griffith University), Leonie J Pearson
(University of Canberra) and Megan C Evans (Australian National University)
Preferred citation:
Lo, A.Y., Pearson, L.J. & Evans, M.C. (eds.). (2014). Opportunities for the Critical
Decade: Enhancing well-being within Planetary Boundaries. Australia New Zealand
Society for Ecological Economics 2013 Conference Proceedings. The University of
Canberra and Australia New Zealand Society for Ecological Economics, Canberra,
Conference Chair: Leonie Pearson
Conference Scientific Chair: Steve Hatfield-Dodds
Conference Committee: Alex Y Lo, Megan C Evans, Sally Joseph, Robert Gale
Published by The University of Canberra and The Australia and New Zealand
Ecological Economics Society, Canberra, Australia.
ISBN: 9781740883986
Format: Electronic
Conference sponsors:


Table of Contents
I. Managing the Environment
Co-management in protected areas: an opportunity for all? ............................................1
Leonie J. Pearson (University of Canberra), Melanie Dare (University of Canberra)
A theoretical analysis of a hypothetical auction program to pay for biodiversity in
Peruvian Amazon nuts (Bertholletia excelsa) ecosystems .22
Pedro Flores Tenorio (La Trobe University)
Responses and Barriers of New Migrant Communities to Extreme Heat: A Case Study
in the City of Port Adelaide Enfield in South Australia .40
Tahabub Alam, Md Aboul Fazal Younus

Relationship between economic development and pollutant discharge in Southeast
Queensland ....63
Yoshiaki Tsuzuki (University of Queensland and Shimane University)
II. Environment and Society
Greenspace and life satisfaction: The moderating role of fear of crime in the
neighbourhood ......89
Christopher L. Ambrey (Griffith University), Christopher M. Fleming (Griffith University),
Matthew Manning (Griffith University)
What are we teaching and why it matters: A survey of the Australian and New Zealand
university macroeconomics curriculum in a post-GFC, ecologically stressed world.....109
Judith McNeill (University of New England), Jeremy Williams (Griffith University),
Michael Coleman (University of New England)
The Relevance of Charles Taylors Interpretivism for Environmental Politics125
Glen Lehman (University of South Australia)
Fair water distribution......148
Anna Lukasiewicz (University of Canberra)


Integrated Assessment and Decision-Support Tool for Community-based Vulnerability
and Adaptation to Storm Surges in Four Coastal Areas in Bangladesh.168
Md Aboul Fazal Younus (University of Adelaide), Sabrina Shahrin Sharna (BRAC
University), Tamanna Binte Rahman (University of Hawaii at Manoa)
III. Policy and Governance
Policy Instruments for Sustainable Consumption: A Comparison of United Kingdom and
Australian Initiatives ....189
Fred Gale (University of Tasmania)
Chinas Carbon Markets: Prospects and institutional barriers..206
Alex Y. Lo (Griffith University)
What factors are important for effective Greenhouse Gas emissions trading? .219
Neale Wardley (Victoria University)
The Political Economy of Renewable Energy Generation in Australia232
Jemma V. Williams (Australian National University), Jeremy B. Williams (Griffith
IV. Practitioners Perspectives
The Emissions Reduction Fund: a critique..243
John Hawkins (Australian National University)
The practice of decision making in coastal climate change adaptation: Reflections from
a Victorian case study.....259
Steve Blackley (Department of Environment and Primary Industries, Victorian
Economic sustainability: what should it be? ...264
Haydn Washington (University of New South Wales)


Ecological economics is a transdisciplinary field of study that explores the multiple
relationships between complex and interdependent social, economic and ecological
systems. Understanding these systems requires pluralist and integrative approaches,
an appetitive for collaboration and learning, and expertise and a commitment to rigour
within individual disciplines. The Australia New Zealand Society for Ecological
Economics (ANZSEE) is a regional branch of the International Society for Ecological
Economics. ANZSEE seeks to help create the knowledge and understanding required to
build a sustainable and satisfying society (
The ANZSEE Biennial Conference 2013 was successfully held in the campus of the
Australia National University at Canberra during 11-14 November 2013. It was
organized under the theme of Opportunities for the Critical Decade: Enhancing well-
being within planetary boundaries. This book is a collection of nominated proceedings
of the Conference. It is a timely update of the current state of knowledge in ecological
economics. Contributors come from Australia, New Zealand, and a number of Asian and
European countries, and have been working at the forefront of ecological economics
and related disciplines.
Papers in this book address policy-relevant problems about the relationship between
economy, society, and the environment. They are organized into four major themes: 1) I.
Managing the Environment includes papers on the environmental implications of
production processes, and strategies for managing the environment and natural
resources; 2) Environment and Society addresses the nexus of environmental
management, development, and justice, and covers issues about resource distribution,
well-being and education; 3) Policy and Governance provides a forum on environmental
policy instruments, environmental governance, and the political economy of the
environment, and 4) Practitioners Perspectives offers policy-relevant insights from
experienced practitioners. The proceedings present cutting-edge research into these
topics and synthesize latest research findings that are useful for dealing with pressing
environmental problems in Australia and New Zealand, as well as in the wider region.
The Conference organizing committee would like to express gratitude to sponsors of the
Conference for their generous support to the event, including the CSIRO, the
Department of the Environment of the Australian Government, the Murray-Darling Basin
Authority, the ACT Government, and the Crawford School of Public Policy of the
Australian National University. We highly appreciate the Crawford School for hosting the
conference. Thanks go to the delegates of the Conference for their great contributions.

Part I.
Managing the Environment

Co-management of protected areas: an opportunity for all?
Leonie J. Pearson
* and Melanie Dare

Institute for Governance and Policy Analysis and Murray Darling Basin Futures,
Collaborative Research Network, University of Canberra, ACT 2601
*Email:, Ph: 02 6201 5148
Co-management has been identified as the preferred management approach for the
protection and conservation of nature flora and fauna around the world despite the
ambiguity around the meaning and application of co-management in practice. While
some see co-management as a panacea for solving all conservation problems, there is
pressing need to critically explore the governance and management arrangements
required for successful nature conservation. This article uses primary data from three
protected areas in regional New South Wales (Australia), and the broader governance
literature to develop a co-management implementation framework that identifies three
distinct models of co-management in action; control, coordination and collaboration. The
three models vary with regards to stakeholder positions, power, representations,
interactions and role in delivery. This framework is beneficial for exploring the range of
co-management arrangements existing, and potentially suitable for, specific
management contexts and outcomes. While in its infancy, the framework provides a
mental frame from which environmental managers can evaluate the applicability of
alternative governance frameworks and their potential strengths and weaknesses.
The governance of protected areas is often complex and contentious, requiring a
delicate balance between conservation outcomes and community development. In
implementing this balance within individual protected areas and across the broader
landscape, there are often unforseen and unintended social, cultural, economic and
environmental outcomes associated with management concessions and subsequent
trade-offs. While such outcomes can be positive, the real and perceived negative impact
of protected area management on regional communities raises concerns amongst many
local community members. Social tension regarding the expansion of protected areas
within New South Wales (NSW) over recent years resulted in the NSW Legislative
Council undertaking an inquiry into the management of public land in NSW in 2012-
2013. The findings of this inquiry highlight the complexity, and inconsistency, of
governance and management approaches to public land management (including
protected areas), and the need for new approaches that are more inclusive, transparent

and localised (NSW Legislative Council, 2013). These preferred management
characteristics are synonymous with co-management: the political and cultural process
in which a variety of partners share roles and responsibilities for a given task (Borrini-
Feyerabend 2000).
In many protected areas within NSW co-management is already being implemented,
albeit in varying degrees, using multiple models and resulting in differing success. This
paper explores the management of three protected areas in Western NSW rangelands,
each of which, as we shall see, use a different model of co-management. The protected
area case studies were explored to identify their models of co-management, including
how each model influenced governance and on-ground delivery outcomes. These
findings are especially pertinent given the trend towards localism across State and
Federal government policy, whereby local actors become more involved in policy
making and implementation to ensure optimal and relevant outcomes for their local
circumstances (Evans et al. 2013). A better understanding of how co-management is
being implemented in NSW protected areas will enable improved governance and
management approaches that better reflect and incorporate the community interests,
and encourage positive benefits from protected areas for local regions. We provide
some clarity around the issue of co-management, including the development of a
framework to identify different models of co-management currently in practice, and the
provision of practical insights into how natural resource managers can use various
forms of co-management to enhance conservation outcomes.
The paper has four sections. First, we introduce co-management, including a brief
historical overview and its key assumptions. We then describe the three case study
protected areas which is followed by the introduction to the various models of co-
management within the co-management framework. In the final section we provide
practical insights into co-management and suggest improvements to the governance of
protected areas.
Co-management within protected area management
At its core, co-management is a sharing of decision-making responsibility between
those who use natural resources and the state-based management authorities (Berkes
1994). This involvement of stakeholders in the decision-making process is thought to
improve both the knowledge available for rule making and the legitimacy of the rule-
making process (Jentoft 2000a). In turn, this ideally leads to rules that are tailored to
local conditions (Ostrom et al. 1999, Basurto 2005), higher levels of compliance (Jentoft
2000c, Eggert and Ellegrd 2003) and lower monitoring and enforcement costs
(Abdullah et al. 1998), resulting in the enhanced success of conservation management
regimes. Co-management is used in widespread applications and instances, but it has a
distinct theoretical background (for further insights see Carlsson and Berkes, 2005,

Hanna 1994, Pinkerton, 1994 and Jentoft et al., 1998). Recent efforts by Borrini-
Feyerabend, et al. (2013) have shown that co-management has been implemented in a
large range of contexts delineating a varied set of governance arrangements.
Important to note in the discussion on co-management is that we are discussing
different governance arrangements, not that co-management is any better or worse
than other types of management (i.e. purely state or private). The success of any
governance system is about how best it fits in achieving its outcomes within the context
supplied. The literature is clear and we support that any successful governance
arrangement needs: legitimacy; transparency; accountability; inclusiveness; capacity;
fairness; integration; and flexibility (see for example; Biermann et al., 2009, Lemos and
Agrawal, 2006, Lockwood, 2010, and Paavola, 2007).
Recently, there has been a coupling of co-management with other processes, such as
adaptive management (see Armitgae, et al., 2009), or specific industries (e.g. fisheries
co-management see Basurto, 2005). However, for the purpose of this paper we will
focus on co-management arrangements, i.e. the governance structure(s) rather the
holistic management approach. It is important to recognise that governance and
management have very different meanings despite the conflation of these terms in the
broader environmental management literature. As described by Bevir (2012),
governance directs and/or guides management by setting policy and procedures to
ensure the organisation/policy is well run. Management on the other hand, implements
such policies and procedures. Additionally, it is important to note that governance is
different from government. Again Bevir provides clarity on this: government refers to
political institutions, governance refers to processes of rule wherever they occur
(2012:3). In the case of public land management there are essentially three tiers of
organisation in operation; i) the broader policy is set predominantly within the confines
of political institutions (e.g. National Parks and Wildlife Service); ii) such policy is further
refined to suit the local circumstances through locally-based co-management
committees; and iii) the operational management activities are implemented by on
ground park managers and their teams. This tiered system highlights the different levels
of governance and the networks of actors in action, both important aspects of protected
area management. Our focus is on tiers (ii) and (iii).
Co-management is increasingly being implemented, or trialled, to achieve conservation
outcomes. Our focus is on how this can play out within a unified set of broader policy
rules and institutions, e.g. a National Park System or a system of Protected Areas under
the same unified rules. Protected areas are under increasing pressure to deliver
multiple objectives including preservation of cultural heritage, recreation and tourism
opportunities for local communities, and the protection of their environments (Locke and

Deardon, 2005). Kingsford and Biggs (2012:12) note conservation areas are a complex
range of stakeholders and their demands, values, priorities, and the multiple spatial and
temporal scales involved in seeing the challenges realistically. There has been a
change in recent years to move the management of conservation areas from a purely
government responsibility to a shared model with civil society or private actors (Borrini-
Feyerabend, et al., 2013). Many conservation regimes have moved towards a shared
model of management involving more than just government as an actor within co-
management arrangements (see Baker et al., 2012; Bawa, et al., 2011; Gleason et al.,
2013; Weeks & Jupiter, 2013). While acknowledging that governance is dynamic, we
see value in articulating some of the various models of co-management to highlight the
relative merits of each model for specific management outcomes.
Co-management in Rangeland Protected Areas, Australia
Expansion of National Parks in Western New South Wales
Nearly three quarters of Australia is rangeland, comprising the low rainfall and variable
climate arid and semi-arid areas. Rangelands include a large mix of ecosystem types
including native grasslands, shrublands, woodlands and the tropical savanna
woodlands which contain a wealth of biodiversity. However, landuse activities within
Australian rangelands have had detrimental environmental impacts, including numerous
extinctions or flora and fauna species (Australian Government, 1999). Until recently
rangelands have been relatively underrepresented in the national conservation areas.
However, since the early 2000s specific acquisition of rangelands has occurred at the
state level (e.g. New South Wales) where state agencies have acquired land to include
in their protected area register, namely in National Parks. National Parks in NSW has
two fundamental purposes; i) to provide a secure tenure for the effective and efficient
conservation of natural and heritage values and, ii) the provision of opportunities for
public enjoyment (i.e. recreation) (NSW Legislative Council 2013). National Parks in
NSW are underpinned by a number of international and national legislative and policy
commitments, including the 1992 Convention on Biological Diversity (CBD) and the
1992 national Intergovernmental Agreement on the Environment, both of which drive
further expansion of protected areas across Australia.
The NSW National Parks Establishment Plan 2008 directs the priorities in expanding
the NSW reserve system, and focuses on protecting poorly reserved ecosystems
through the building of a Comprehensive, Adequate and Representative (CAR) public
reserve system using bioregions
as the basis of assessment (DECC 2008). The
proportion of bioregions that are protected varies across NSW due to historical and

Bioregions (an abbreviation of biogeographic regions) are large regions of relatively similar geology,
geography and geomorphology. Each bioregion supports a suite of native plants and animals distinctive
from those in adjoining regions. (DECC 2008:4)

environmental outcomes (e.g. historical land clearing which resulted in fragmented
native vegetation, land tenures), with reservation levels of the Western NSW bioregions
assessed as being low or very low, especially when compared to Eastern and coastal
bioregions (NSW Legislative Council 2013).
This poor representation of Western bioregions in the NSW reserve system has driven
the rapid expansion of National Parks in Western NSW, which resulted in significant
concerns regarding the social and economic impacts of land conversion on local
communities (see NSW Legislative Council 2013). These concerns, coupled with the
NSW2021 goals regarding greater community involvement and the provision of
opportunities for people to look after their own neighbourhoods and environments,
highlight the need for a better understanding on the governance arrangements for
protected area management.
During 2013, we undertook 22 semi-structured interviews with key community and
governance leaders (e.g. local government, protected area managers, government
managers, indigenous groups, community members) associated with three rangeland
parks in western New South Wales as described in Table 1. Interviews lasted up to one
hour, questions were developed using the literature and the researchers understanding
of the context from previous studies
, with questions including themes around
community involvement in park management, perceived local benefits and impacts of
protected area establishment, and land use history. Interviews were analysed using an
adaptive theory approach (Layder 1998), where content themes were developed
iteratively based on both the literature and empirical evidence. Our task was to
understand the governance structures for each park and determine the perceived
acceptability of each of these approaches within the local communities and the
effectiveness of the approach for regional development outcomes.
The interviews highlighted substantially different co-management governance models
for each of the case study protected areas, and the influence of these governance
structures on the achievement of a diversity of management objectives. This are
summarised in Table 1 and further explored below.
Booligal Station National Park
The Booligal Station National Park is one of several new National Parks located within
the Hay region. A renowned station with significant cultural values for community

Research was being undertaken in the region as part of the Murray-Darling Basin Futures Collaborative
Research Network project Building Sustainable Communities (
darling-crn/projects/sustainable-communities )

members from across the region, the purchase of the property and lengthy delays in
opening the new park to the public created much angst within the community
. The
strong community ties to local properties strengthen the communitys interest in the
ongoing management of Booligal Station and other protected areas within the region.
However, such expectations are not being realised, with many community members
perceiving that the governance and management of Booligal Station (and other new
parks within the region) as being closed to the public, although significant input from
the local Nari Nari indigenous people is well recognised and received. Additionally there
is an advisory group that meets to provide overall advice and insight to NPWS on
Booligal management and a small part of the park interacts directly with a set of private
landholders in a wetland ensuring a need for close co-ordination. This advisory group
is also referred to as a community liaison group which is not well publicised and is
perceived as being very hushed, with the community being predominantly unaware of
the advisory group selection process. Governance of the Booligal Station, and other
parks within the Hay region, is primarily based on NPWS staff and invited indigenous
representatives, with a small committee of locals contacted when required. This
restricted governance approach does not adequately seek greater community input, and
as such contributes to the level of community concern regarding the expansion of
National Parks within the region and the legitimacy of NPWS management objectives.


Table 1: Summarising three case study protected areas
Booligal Station National Park
(as part of the Lachlan Valley
State Conservation Area)
Yanga National Park
(as part of Murrumbidgee
Valley National Park)
Mungo National Park
(is 65% of the Willandra lakes
World heritage Area)
Size 6,500 hectares 66,734 hectares 110,967 hectares
Date of gazetting 2010 2007 1979
Previous use Multiple sheep/ wheat farming
Sheep/ wheat farm in the district Western Lands pastoral leases, sheep
Preservation of current flora Restoration of 12 different
wetland types; protection of
identified threatened and
vulnerable flora and fauna.
Conservation of significant cultural,
archaeological, and biodiversity
values; provision of recreational
Government with advisory group Advisory board to government Joint-management with Indigenous
and government
plans currently in
Fire Management Strategy & Pest
Management Strategy
Fire Management Strategy& Pest
Management Strategy
Plan of Management & all necessary
(e.g. Fire)
Level of
Low Medium High

This community contention is clear in our interview results as shown by study
participants commenting on the role and the ongoing park management operations of
the park:
The aim of National Parks benefit to the public, but NO! Only for
conversationalists, box thorn breeders [weeds] and wild pig breeders. No one
can camp, no dogs, no fires, and you have to pay for entry. These parks used to
be used regularly by the local community, [now they are] land taken out of
productivity and locked up tight as a drum.
We lose out, because the properties arent broken up for sale, we cant expand,
also they are paying more, twice what the land is worth. Local farmers are being
squeezed, we used to agist [livestock], now we cant even walk through the land,
which we always did.
It is disappointing the Parks are not open to the public. They say they will be but
it costs money to have them open.
Cant promote tourism by locking up the land. Tourism is not the answer to
regional economic development it never was and it never will be.
Interviewees also raised a number of governance concerns pertaining to issues of
inclusivity, power, representation and management operations:
There is no respect from State government for local government what-so-ever.
[Local government] trust some personnel but not the State government system. It
is mostly a debacle but not the fault of the people on the ground, it is the senior
Local government to National Park interactions are informal or needs basis.
Local Government and community have no say in National Parks. Some
Aboriginal groups have a say, especially on new input on acquisitions also
cultural tours etc.
Local Government is not strong enough with National Parks they should be
hammering them to open [the parks] up for all.
I dont know who makes decisions about national parks we [local landholders]
The local park managers are well aware of the community concerns but feel that their
hands are tied:

National Parks is so busy we havent had time to do all the plans and get things
going, we are understaffed and with new acquisitions all the time, its hard to
keep up. Once we have the management plans established we can be more
involved in the community whenever that will be!
These concerns highlight important limitations of a co-management model that limits
communication. The limitation in communication leads to lack of transparency and
hence restricts the broader understanding within the community of park management
constraints that inhibit effective and transparent park governance and operations.
Yanga National Park
Yanga National Park was opened in 2009, after the purchase of Australias largest
sheep farm in 2005, which was followed by significant community concern
. The iconic
Yanga Station was an important economic and cultural asset for nearby Balranald,
providing substantial agricultural employment and having Aboriginal and European
cultural significance. Despite the rocky start, the governance of Yanga Station is well-
established, with a community advisory group in place to provide local insights in
decision-making. The advisory group consists of representatives from across the range
of community interests (e.g. local government, business, Aboriginal group, Field
naturalists, National Parks Association and local land holders). There is also a Friends
of Yanga group. volunteers with a long history and association with Yanga who come
out to the park and provide tours and experiences, as well as supporting Parks activities
and undertaking social networking.
Interviewees raised a number of concerns about the acquisition and management of
Yanga on the Balranald community.
[Yanga National Park] has utterly destroyed our community, and others too! Half
the towns income went.
National Park dont manage the area its just a mess of land all overgrown,
fire hazard need to clean it up.
Yanga was a prominent property, an entity in itself, when sold locals felt
betrayed, it always employed generations of people, it was almost as if the
owners didnt really own it the community owned it. 4-5 generations worked here,
the connections are still here, the memories are still here.


There are far too many national Parks for reasonable management. They shut
the gates and people cant see them. It rains, they shut the gate. It is pathetic
and gives Balranald and NPWS a bad name.
With access now provided to the public and local community, there seems to be a
waning of many of the concerns and the ongoing management of the Yanga National
Park providing benefits for the community, although still constrained by the complexity
of the management environment:
National Parks buy local its just the local people dont want to see that, or they
dont understand
Yanga does lots to work with the local community, employs full time local staff,
provides seasonal employment, buys locally whenever possible, attracts tourists
to the region.
There is a challenge for resourcing the national park a clear conflict between
raising money which the park gets to keep and conservation.
The current governance arrangements were raised as a concern for the local people
and in achieving transparency and trust between NPWS and local communities.
Wouldnt trust Parks as far as I can kickem.
Yanga Parks [they are] not interested in community opinion.
Its not what you do its who you are in the local area really important to
employ local people and get local support we are working hard to get past the
local apathy for what is on their doorstep.
Yanga National Park uses an adaptive management approach to management planning
which is discussed, and agreed to, at the Community Advisory Group. However, this is
difficult to implement due to the various tensions regarding park management
When its dry its a national Park, when its wet its a public recreation area, it is
also a mixed tenure with the travelling stock route and commercial finishing
licences (yabbies and carp) still in place, with strong built and cultural heritage
and ecological significance (e.g. RAMSAR site).
On the day-to-day delivery it is all about pests, weeds and fire these are all pre-
planned and we use whatever resources we have available, e.g. volunteers, local
funding, parks staff.

Mungo National Park
Home of the Mungo Man, Mungo National Park is a well-established National Park with
well-developed governance approaches. Operated under a joint-management approach
between the NPSW and the Aboriginal Management Committee, Mungo National Park
governance is embedded in a partnership arrangement that facilitates mutual learning
and recognition termed joint-management. This is a form of co-management which
evolved from one with purely Aboriginal people involvement to now include local land
holders, Aboriginal elders and the Council. This reciprocal arrangement provides
sufficient accountability and legitimacy for both parties and the government, with the
Mungo National Park management objectives and operations predominantly determined
by the joint-management committee (within relevant policy, legislation and regulatory
Co-management of the Mungo National Park is seen as a positive by research
The National Park is really great they have done a lot for the Aboriginal people,
work for younger people and older blokes, encouragement to look further ahead,
caring for country. National Parks allows us to do all that, before they came on
the scene we didnt have the money to do all this.
We are all working together to make the park better.
Black and white, we mix it all up and have a ball.
However, success is varied and depends on local conditions that acknowledge the long-
term nature of protected areas and the necessity for dynamic governance
Co-management takes time, dont rush everything through at once take time to
talk, and think and look at it again, there are different types of people involved
who need to work through different issues.
We are always working together, differences can all be worked out if you sit
down and talk about it, people will be reasonable. Makes you laugh how
people change as you go through the process.
The governance of co-management
The case studies provide us with insights into the application of co-management as a
governance approach within protected areas. Synthesising this material, we propose a
co-management framework that places the different types of co-management models

along a spectrum, from total government control to one of total shared responsibility.
This framework articulates the positions, power and representation of the stakeholders
in co-management arrangements, as shown in Table 2.
The three models outline specific key governance attributes of co-management.
Importantly, we are not advocating a single model of co-management, rather we are
advocating a consideration of the types of co-management and what this could mean in
different contexts.
The co-management continuum outlined in Table 2 draws on the environmental and
multi-level governance literatures. Multi-level environmental governance systems have
emerged across the world, in which governance is organized at, and across, different
levels and scales, involving multiple actors (government, private organisations and
community) (Ostrom et al. 1961). Hysing (2009) and Driessen et al (2012) have
previously defined different modes of environmental governance. We build on their
contribution by using some of their key features necessary for distinguishing models of
co-management (i.e. stakeholder positions, power base, model of representation,
mechanisms of social interaction). The four features that differentiate our framework
from previous work are:
i. a focus on the governance of policy delivery or implementation. This ensures a
close practical and conceptual link between co-management (usually
investigated at the delivery end) and environmental governance (usually focused
on governments multifaceted role in environmental policy).
ii. an in-depth investigation of the bottom-up perspective to governance, thus
continuing the focus on delivery rather than policy. Which means that tensions
between central and decentralized state are not prevalent.
iii. not limiting our actor set to the traditional state, market and civil society trio,
ensuring a nuancing of the players, their presentation and roles. Our actor set
focuses on common players in co-management, i.e. the government or state (S),
private organisations and groups including non-government bodies, private
trusts, companies and environmental groups (P) and society or community (C)..
iv. we consider the role of all actors equally, not separating government actors
from other stakeholders. This reinforces the notion that co-management is
essentially about the balance between all actors, with no privileging of
government, over other actors.

Table 2. Models of co-management governance structure and key features.
State (S), private organisations and groups (P) and community (C)
Model 1 - Control Model 2 - Coordination Model 3 - Collaboration

Stakeholder autonomy determined
by state
Autonomy of stakeholders within
predetermined boundaries
Self governing entities determine the
involvement of all stakeholders
Power base Authority of state, Competitiveness; contracts &
legal resources
Self-sufficient (autonomy) leadership and
social networks
Model of
Pluralist (national election &
Corporatist (formalized
stakeholder arrangements)
Partnership (participatory stakeholder
governing arrangements)
Mechanisms of
social interaction
Top down; command and control Actors decide; autonomously
about interactions
Bottom up: social learnings,
deliberations and negotiations
Delivery State State, contracted + volunteers Shared between stakeholders
Example Booligal Station Yanga Mungo

This means that our framework for examining governance co-management has five
1. Actor positions; identifing the types of actors involved, who initiates action and
how the actors relate to each other (see e.g. Driessen et al., 2001 OToole and
Montjoy, 1984).
2. Power base; the formal and or informal basis of power in the governance
structure (see e.g. Shove and Walker, 2007).
3. Model of representation; how actors interact and engage in the governance
structure (see e.g. Glasbergen and Groenenberg, 2001)
4. Mechanisms of social interaction is how decisions are made in practice (see e.g.
Hanf and Scharpf, 1978).
5. Delivery; outlines who is responsible for, and undertakes, the majority of on-
ground activities for conservation (see e.g. Pomeroy and Berkes, 1997)
Model 1 Control. This model highlights the seemingly deliberate isolation of the
actors from each other, with the state controlling decision-making through
predominantly discrete dialogue with individual actors/interests. In the control model, the
State uses its discretionary power as the legal manager of the protected areas to control
decision-making, including controlling who is involved, when and to what extent. While
such an approach may seem unnecessarily hierarchical in a mature democracy such as
Australia, this model has significant benefits and limitations that need to be recognised
before one should unduly discount its merits.
First, the control model is a legitimate model within the regulatory frameworks that
underpin protected area management, albeit not the preferred approach when broader
development goals are considered (i.e. NSW 2021). Second, the control model
observed was occurring in Booligal Station National Park, a relatively new protected
areas, where no management plan has been prepared, and resource availability was
limited (e.g. staff expertise and time). Although such circumstances could benefit from a
more participatory approach to actively shared resources critical for efficient and
effective park management (Eversole and Martin 2005, Whelan and Lyons 2005,
Woolcock and Brown 2005), protected area managers in this case were simply not able
to undertake such participatory activities because of the significant resourcing required
and the priorities of other park management activities (e.g. control of weeds, fire etc.).
Third, the control model, because of its constrained nature, should encourage a fast
decision-making process, and thus enable proactive protected area management
through the timely completion of management plans and operational documents,

although this has not occurred in this instance, due to the rapid expansion of protected
areas in the region and the resourcing constraints.
In our case study of Booligal Station National Park we can see that there is a need for
adequate resources, transparency, and accountability for such a model to be effective.
The lack of progress has raised significant community concerns regarding the capacity
of NPWS to effectively manage the lands, claims which drive the perceived necessity of
a more participatory approach to protected areas management in the region that
enables positive management outcomes.
Model 2 Coordination. Unlike the control model, this model deliberately encourages
dialogue between the state, the community and private organisations although the state
is controlling the dialogue at all times. This approach is more participatory than the
control model, actively encouraging inclusion in decision-making from other actors,
while retaining final decision-making power at all times. Actors have the opportunity to
negotiate decision-making outcomes within the often formalised terms of reference they
have been provided, reflecting a networked approach to governance. This approach
provides opportunities for localised interests to be brought to the decision-making table
and debated, presumably, in a considered manner. However the central control of the
state remains with the state making the final decisions based on actor feedback.
Such an inclusive approach reduces tensions around the capacity of NPWS to manage
the lands, through opportunities to form relationships, transparency of management
objectives and constraints, and an element of community ownership of governance
decisions (Dare et al. 2011, Hailey 2001, Mascarenhas and Scarce 2004). This is
clearly shown in Yanga, with a preference to employ locals to extend the network and
influence of the park into the broader community (e.g. Balranld Inc and local schools).
The retention of ultimate control by the state would be perceived by some as a negative,
despite the regulatory framework supporting this role, driven by ongoing negative
perceptions regarding the intent and legitimacy of National Park objectives within the
regional economy. This model requires the willingness of actors to be at the decision-
making table with the knowledge that they dont actually have the final say in decisions.
Such an arrangement would require a level of trust in the state and, hence, such
arrangements may take some time to deliver after initial land acquisition, time for
community members and interest groups to adjust, refocus and move beyond the initial
angst and uncertainty.
Model 3 Collaboration. This model represents the most inclusive form of co-
management, whereby formalised partnerships are established amongst the actors to
govern park management. Such participatory governance partnerships deliberately take
control away from the state, instead dispersing control throughout the partnerships,

albeit with caveats regarding public accountability and compliance with legislative
requirements etc. Such collaborative approaches, when functioning effectively,
encourage mutual learning and deliberately seek the inclusion of a broad range of
interests to generate better decisions (Creighton 2005, Dare et al 2011, Eversole and
Martin 2005). However, collaborative processes are often resource intensive can take
considerably longer (Beder 2006, Borrini-Feyerabend and Tarnowski 2005) and, hence,
are not suitable for all contexts. These constraints of collaborative management
highlight the importance of the careful selection of co-management model. Collaborative
processes require a high level of commitment from all parties for both effective
governance and effective management processes. Such commitment may only be
established once initial community concerns regarding broader impacts of land
acquisition and benefits of protected areas are adequately addressed and hence
legitimacy of protected areas and confidence in the capacity of NPWS is attained.
The Mungo National Park is a good example of this model of co-management with high
levels of engagement, activities and shared decision making. Although this has led to
long lead times in decisions being made and a more inclusive community engagement
in the final solution, e.g. taking 2-3 years to decide on how to incorporate local culture in
interpretation signage.
What models of co-management mean for outcomes
The models of co-management presented above highlight the multiple actors and their
possible roles in protected area co-management. The governance, and consequently
the management, of protected areas is not the sole realm of state based managers
such as the NPWS. Modern democratic expectations, government policy and strategic
goals, and resource constraints (including time, money and expertise) highlight the need
for multiple actors to be included within protected area governance, especially in remote
and regional areas which are typically under resourced and facing significant
development pressures (e.g. climate change, diminishing profitability, demographic
It is important to recognise that all the models discussed occur within the same
legislative framework of protected area management. Keeping the technocratic framing
constant across the three case studies shows the breadth and diversity of possible co-
management arrangements in implementation. It also continues to highlight the role of
the state in setting policy objectives that prioritise conservation outcomes, objectives
which are often best delivered through a more inclusive localised approach. Each
protected area sits within a local community with its own cultural heritage and
development story. These local stories affect their approach to protected area
management, often a new land use forced upon them, with perceived negative
consequences for their communitys future development, livelihoods and sustainability.

These stories need an opportunity to be rewritten and reframed to become recollections
that enable optimistic or at least constructive outcomes for the communities and for the
environment. Through a deliberate, transparent and inclusive co-management
approach, conservation outcomes can be achieved in a more effective manner with less
community backlash and more community buy-in.
The development of this framework is to inform future management of protected areas,
particularly in NSW, Australia, but also in the broader context of local communities and
their interactions with protected areas globally. It occurs at a time where there is
increased pressure from terrestrial protected areas to accommodate divergent uses,
values. For example recent discussion has occurred in NSW regarding national parks
being used for hunting and grazing (New South Wales Legislative Council, 2013). The
way proposed to deal with these new and alternate uses of protected areas has been to
state that co-management will be used to deal with competing uses. However, as we
show depending on the model of co-management there may be no, slow or harmonious
resolution to this issue.
This paper is limited by its cases and its framing. This framework is developed for
terrestrial protected areas, however we note that whilst co-management has been very
successful in marine areas, the level of nuancing and implications for actors has not
been fully explored, as we have done here. Perhaps this is an area for future research
that links the terrestrial and marine co-management models. Additionally more work
needs to be done to explore the various models of co-management in practice to help
explain why models work in some instances and not in others. This paper does not
adequately explore the range of implications of co-management associated with
broader policy development, network governance, or even participatory management.
Rather the paper provides a basic description of the various models of co-management
in practice and opens up the space for more focused debate on the implications of such
approaches in the governance, and management, of public lands for conservation
We would like to thank the constructive and informative comments provided by
participants at the 2013 ANZSEE conference and various discussions with colleagues
over the past years, specifically Prof. Dave Marsh. This work would not have been
possible without the awesome efforts of Caroline Sinclair, the worlds best research
assistant and the tireless time that people gave freely to answer our questions. This
work is partially supported by ANZSIG seed funding and the Murray-Darling Basin
Futures Research and is supported through the Australian Governments Collaborative
Research Networks (CRN) Program.

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A theoretical analysis of a hypothetical auction program to pay for
biodiversity in Peruvian Amazon nuts (Bertholletia excelsa)
Pedro Flores Tenorio

La Trobe University, School of Economics, Bundoora Campus. Melbourne, VIC
3083. Australia
Peru is a megadiverse country with the second extension of forests in the Amazon
basin. The design of efficient public policies for these territories is challenging due
the fragility of public institutions and lack of economic valuation of important
ecosystem services provided from old-growth forests.
This paper develops preliminary a dynamic system model and a theoretical analysis
from the ecological economics perspective for a key non-timber forest product of the
Peruvian Amazon basin: the Amazon nut (Bertholletia excelsa). Specially, we
analyse the bioeconomic dimensions of two ecosystem services: pollination and the
forest cover to provide habitat for flora and fauna.
The contribution of this paper is to present evidence that support the argument that
decision makers from development countries have an excellent investment
opportunity for conservation of biodiversity in indigenous lands with Amazon nuts.
biodiversity, non-timber forest product, auctions, pollination, ecosystem service,
Peruvian Amazonia
Loss of biodiversity is a significant global environmental problem, especially for
extremely biological diverse countries, because of their importance for the entire
world with such a large quantity and diversity of species and global ecosystem
functions. Markets for biodiversity conservation generally do not exist, and this
value is therefore not included in the national accounts. This lack of formal valuation
has contributed to growing rates of degradation in forests around the world
(Stoneham et al. 2012). In order to preserve biodiversity, new approaches are
required. This is complicated by the fact that many developing countries face the
challenge of balancing economic development against preserving biodiversity that is
critically important for the rest of the world (United Nations Environment Program et
al. 2008).


Over the last 30 years, there have been special efforts of governments from
developing countries in Amazonia to develop policies and design strategies to
improve the conservation of biodiversity (Flores, 2002; Dourojeanni et al. 2010) . The
best known efforts have focused on the creation of reserves and protected natural
areas on public land (Flores, 2011). However, less has been applied in privately held
by indigenous forests or rural land. Some authors have criticised in the case of
Amazon nuts landscapes, the economic opportunities that can provide this non-
timber forest product to solve their poverty and degradation of the poverties (Escobal
et al, 2002). Other authors have criticised the lack of planning of government in rural
areas. When economic incentives have been developed for private agricultural land,
they have been to support unsustainable practices by less efficient farmers (De
Ferranti et al., 2005).
The provision of conservation of biodiversity in the territories of indigenous people
using non-timber forest products as the main source of income offers an interesting
context to analyse from ecological economics perspective. However, there are few
initiatives to promote provision of conservation goods from public forests because of
the lack of public funds and critical opportunity costs in an economically developing
setting (Flores, 2002, 2011). Corruption has also affected results of forest
concessions (Amacher et al., 2012), increasing transaction costs for stakeholders.
For developed countries, auctions for the conservation of biodiversity have been
developed where private land managers are invited to formulate their payment
requirement for a clearly defined conservation measure. Competition between
landholders in the auction can reveal the 'real' lowest cost of delivering the desired
conservation outcome. In our analysis we will include the possibility that the
opportunity cost of land is much lower than in developed countries, however this
does not mean that the economic value for conservation should be smaller, as some
researchers have considered (Fleck et. al., 2010).
In this paper we consider mechanisms that have been developed and implemented
in developed economies such as Australia which have the goal of conserving
biodiversity. The purpose is to develop these mechanisms in ways that might
successfully deliver conservation outcomes in developing economies. We identify as
a critical problem that the implicit economic valuation of ecosystem services is zero.
And, we assess in this paper, how some preferences for conservation of biodiversity
could be made explicit to give proper signals to different stakeholders.
The Bush Tender scheme offers payment for conservation services in the state of
Victoria, Australia. This innovative auction based approach has been able to deliver
results that have been elusive with a range of previously applied mechanisms like
command and control, subsidies or grants. The Bush Tender scheme applies only in
the state of Victoria where 33,339 hectares have been incorporated into Bush
Tender projects since 2001. These auctions have been designed to offer an
economic incentive to landholders to provide the public goods of conservation of


biodiversity through activities such as retention of native trees, grazing management
or fencing and targeted weed control (Department of Sustainability and Environment,
2012). These economic incentives have been developed after an assessment that
found other mechanisms have not demonstrated improvements in the conservation
of biodiversity. An important aspect of this scheme is spillovers. The conservation of
biodiversity on public land or reserves depends in an important way on the outcomes
obtained in natural resource management on private land (Lindemayer and
Burgman, 2005).
The Bush Tender scheme seeks to improve the protection and management of high
significance biodiversity assets in an efficient way. A key aspect of this efficiency is
that the tender scheme elicits the willingness of landholders to supply conservation
services, thereby enabling a market for the conservation of biodiversity to form when
combined with demand for these services. This approach is successful and
empowering because it enables landholders to generate a regular and reliable
income stream thereby providing landholders with the incentive to manage and
protect native vegetation. This is an important dimension when considering such a
scheme for developing countries that seek to preserve biodiversity.
The Bush Tender scheme has required a commitment by Australian governments of
AUS$ 18 million during last 10 years towards landholder payments for on-ground
works and land use changes to improve the condition and security of their native
vegetation over a five-year period and with permanent activities.
In the remaining three sections of this paper, we present: First, the methods and
materials applied, identifying the study area. Then, we present the preliminary
ecosystem model. And, we explore from the ecological economics perspective, its
biological and economic dimensions. Finally, we present a hypothetical auction-
based approach program to pay for two ecosystem services. We discuss if these
auctions could be applicable to the Peruvian Amazon nuts case, specifically
considering the case of indigenous people.
Methods and materials
The assessment of the potential application for auctions is analysed in this
preliminary study that is applied to a case study of Amazon nuts that stands in old-
growth forests of the Peruvian Amazon. This paper specifically focuses on economic
incentives for the indigenous territories taking an ecological economics perspective.
An ecological-economic model is developed to analyse the complex dynamics of
ecosystem services and identify key parameters and variables. The model explores
the potential profits of non-timber production in an old-growth forest and its links with
ecosystem functions and pollination input,


Second, to address the link between profits and pollination input, the model develop
by Winfree et al. (2011) is considered and analysed for the case of Amazon nuts
production function characteristics. And, third, a hypothetical conservation program
is discussed from the adaptation of the model of Stonehan et al (2003) to the
characteristics of Peruvian Amazon.
Study area
The region of Madre de Dios in the Peruvian Amazon is part of the hotspots of
biodiversity of the world and the current Amazon nut collection areas cover more
than 2.5 million hectares.
In the Peruvian non-timber concession areas created in 2001, approximately a 1000
Amazon nuts concession holders enter the 1 million hectares of forests and 5 native
communities with 52, 963 hectares titled where interrelations among flora and fauna
for pollination of Amazon nut trees has developed over thousands of years.
The exports of Amazon nuts are controlled by a small number of firms. The harvest
is conducted manually on the forest floor after the extremely hard-covered fruit of the
Amazon nut trees have fallen. Both the collection and the subsequent transportation
are labour intensive and costly. Once harvested the nuts are transported to collection
centres in 70 kilo bags, where they are dried.
Monetary income from the sale of Amazon nuts is the most important source of
income for indigenous people, even though it is a seasonal activity. At the beginning
of the harvest 2011 in January, the price by barrica was S/75, at the end of the
harvest in March 2011, it was S/150, as seen in Table 1, and for which we have
estimated economic benefits. It should be noted that this utility is achieved with an
economic value of their work, which does not include health insurance costs, or
formal contracts. This could be improved by moving towards an organic fair trade
certification if the premium price received could be invested to improve labour
conditions, but currently, the costs of certification are high for the size of business for
the indigenous people. Also, it is important to highlight that the main interest of
projects with natural resources of indigenous people of this study have been the
focus of REDD+ (Reducing Emission from Deforestation and Forest Degradation)
carbon sequestration projects (Ministerio del Ambiente del Peru, 2010).
As someone who has worked in the study area of this paper since year 2001 and he
has witnessed the changes in the prices and the benefits for different stakeholders,
including indigenous people. We have gathered some information in June 2011 from
the organic producers of the indigenous communities with some characterization of
the producers that it is shown in Table 1. It can be seen that the descriptive statistics
of the 4 native indigenous communities in the area of study shown a total area of
almost 50,000 hectares with 10,301 Amazon nut trees. This natural capital allows
120 harvesters and their families to obtain an estimated average profit of US$ 1163


per harvester per year or US$ 3.5 per hectare per year. These quantities are 50%
less compared with other crops and estimates of the same Amazon nuts in Brazil or
Bolivia, but is one of the few alternatives of income for them. It reflects in part, the
minor density of these Amazon trees that happen in Peru. See Flores (2011).
Table 1: Descriptive statistics of harvesting Amazon nuts from 4 indigenous communities*,
Madre de Dios Peru, 2011
Variables/ 4 Native Communities Total Mean Min. Max. S.D.
Area (ha) 48,363 12,090 3,857 31,423 11,317
Amazon nut trees 10,301 2,575 1,120 4,003 1,125
Amazon nut harvesters 120 30 18 52 13.49
Production in barricas (bb.) 4,064 1,016 343 2,018 640.63
Production per productive tree (bb.) ---- 0.37 0.31 0.54 0.09
Production per harvester (bb.) ---- 35.17 19.05 67.26 19.27
Estimated profit per harvester/ year ($) ---- 1163.79 645.56 2278.84 657.94
Estimated profit per/ hectare/ year ($) ---- 3.52 2.17 4.59 0.98
Source: Own computations, Flores (2011)
*Notes: Price: S/150 / bb. With an exchange rate of S/2,70 per USD.
The Ecosystem Model
Biological dimension
The biology of the Amazon nuts trees include the fruit that are non-timber forest
products and have the characteristic of being renewable. Every year, from January
to March, these fruits fall to the ground of these gigantic trees (more than 50 meters),
that can produce fruits during 500 years and live more than 1000 years, are collected
to obtain its edible seeds that are dried and shelled to be exported. On the other
hand, the renewal characteristic of fruits production is the result of numerous
interrelations in the fragile ecosystem where Amazon nuts trees stands. Among
those interrelations, we consider special attention to the disperser role of the agoutis
(Dasyprocta spp.) and the success of the cross pollination of the Amazon nut tree
flower, by the hymenopterans bees of the Bombus, Centris, and Xylocopa genders
(Corvera-Gomringer, R., et al., 2010).Every year, the agoutis hide and store 3 to 8
seeds per each seed they consume; therefore, it has allowed that the agoutis
descendants find food in the same ecosystems, while some of the seeds that
dispersed turned into productive trees (Cornejo, 2001).


The productivity of Amazon nuts trees depends critically of the successful cross
pollination of its flowers by bees, the previous year. To fulfil their ecosystem
functions, these bees need a forest cover that they can use as habitat. It is critically
affected by increase of forest fire smokes due changes of land use. (Corvera-
Gomringer, R., et al., 2010). In this paper, we have simplified the complex
interrelation between biodiversity and the production of Amazon nuts with the
following two relations:


NTFP stands for the natural production of nuts in year t, that depends on abiotic
factors (e.g.:temperature, rain, wind among others) and cross pollination of Amazon
nut trees in year t-1. In this model, we consider ab as an exogenous variable
ceteris paribus and focus our analysis in the change of cross pollination variable.
is the quantity of productive Amazon nuts trees in year t. It depends also on
abiotic factors and the quantity of seed dispersal sd produced by agoutis from 15 to
500 years ago, that also depends on the quality of the forest. This overlapping of
functions is summarized in the following graph (Figure 1).

Figure 1. Overlapping in Biodiversity Conservation in Amazon nuts forests and ecosystem
From the ecological perspective, an indicator of the sustainability of the production of
this non-timber forest product is that the successful cross pollination of the previous


year is associated with a non-degraded forest where the Amazon nuts will be
extracted in this year, ceteris paribus abiotic factors. For the sustainability of the
biological production of this NTFP, the resilience of the ecosystem is more important
than the number of Amazon trees (Q
). As it was clearly identify by the International
Union for Conservation of Nature (IUCN) when put this specie in its Red list in Brazil.
(Flores et al., 2011)
There is a threshold of impact in the forest cover where Q
could be positive, but
zero. The positive relation between NTFP
and biodiversity is more evident
when two additional equations are included:


Where FC
is the forest cover measured in percentage, proxy value of the non-
degradation of the forest. And, r
is the intrinsic maximum growth rate of the forest
cover specific to the ecosystem where Amazon nuts stands and K is the carrying
capacity of the forest cover abundance that allows a habitat for the pollinating fauna.
Following Hein (2010) in equation 4), we consider that G
represents the growth of
the forest cover, and it is measured as a percentage. For an estimation of the model,
a baseline of 100% is assumed. And then compared for the year of data to
determine how much the forest cover has been reduced. If the error

term e
has an
expected value of zero, then it is an indicator of the resilience of the ecosystem.
The relationship between reductions of FC
is linked to the reduction of q
, and we
argue that reductions can be addressed with precautionary activities in the forest as
well as through permanent activities similar to the Bush Tender program.
Economic dimension
The economic dimension of the NTFP gathering from the perspective of indigenous
people in Peru, with five percent of total area is analysed here. The Gatherers-
Hunters have a dynamic of use and conservation of natural resources that goes
against the reduction approaches that have been made with a traditional economic
approach, looking them only in the dimension of poverty. Some Policy makers in
Peru look at them as backwards sector, considering in their analysis only monetary
variables and traditional indicators such as gross domestic product growth or
unsatisfied basic needs (De Soto, 2010)
The economic dimension of the decision making process of the indigenous people
must be considered following a Georgescoau-Roegan tradition and not only
including ecosystem service values as if they would be solved by the market
(Gowdy, 1998). We understand the sustainability of the non-timber forest production
and conservation of biodiversity associated is achieved if these people continue
living valuing the life that they have chosen as valuable to live (Sen et. al, 1993).


This expected quality of life includes to have the right to maintain their tradition to
gather, fish and hunt, without being pressured by public officers to do agriculture or
renting their lands to undertake other activities more profitable.
To model the economic perspective, we can relate the harvest (H
) of the Amazon
nuts with the natural production (NTFP
), and also with the price paid by the
exporting company (P
) as the following:

It is assumed that Indigenous people harvest almost everything they can, but we
have seen how also they see the price of last harvest season as reference to
preparing themselves and invest in the current harvest campaign, and also they
expect a price for this season. The representative elected by them tries to negotiate
all the production in a certified way.
In Table 2, we see a market with growing prices for Peruvian Amazon nuts, as it
happens from the last decade to the current one due to various factors: more
demand due to a growing human population; it is considered a luxury good, also
even crisis has affected some regions; other destinies have continued with the
Amazon nuts are the main source of income for indigenous people. Before the
period presented in Table 2, it has been years as 2001 when the Price offered their
product was as low as 10% of the price offered in October 2012
. At this time, the
economic value of the non-timber forest product was so low that doesnt give any
incentive to put too much effort in organising to manage the natural production. Now,
even that there was an international crisis in Europe and USA that reduced the
consumption of Brazil nuts, other countries as Australia, Russia or Canada have
replaced the former importing countries as is seen in Table 2.
Indigenous communities sit better in the global market economy, moving from a
barter economy, that they did 15 years ago. In the past, the firms charged the
indigenous people for transporting their nuts harvested. Today, some indigenous
people have their own boats to transport it by themselves. Therefore, they have
reduced their transaction costs, and since prices have grown significantly, they can
work more days, work more hours per day, afford basic capital costs of machetes
and gathering tools and payment for food for the days that are worked in the field. It
also, improved relations with exporting firm and thanks in part, to support of some
local Non- Government Organizations, trying to work together, they have improved
their negotiation power in the face of the monopsony of the exporting companies.

Observation registered by the researcher in the native community of Palma Real in year 2001.


Table 2. Peruvian exports of Amazon Nuts in US$ FOB

Source: Comision de Promocion del Peru para la Exportacion y el Turismo - PROMPERU

The organic certification has bring some more commitment for the exporting
company to show their clients paying a fair price, however the indigenous people has
to relies in the projects of the NGO to pay for a certification, that it should not be the
main source of dealing with paying for biodiversity.
Now the prices are not so different with the offered by other non-indigenous
harvesters. Organic certification has been useful to search for a fair price, but it is
far away to be the main strategy to pay for conservation of biodiversity. We consider
that certification is not an end itself, but a mean. As in the case of Peruvian Amazon
nuts almost everything is exported, we consider that the importing consumers as well
as the government should provide the firms with the right signals to increase their
participation in the payment for conservation of biodiversity. One validate way is with
a hypothetical auction conservation program. This will be significant for the firms,
because they have an interest in maintaining the sustainability of their natural
resource inputs. As presented in Figure 1, the question about the resilience of the
Amazon nut ecosystem is something that should not interest only to some
consumers and the indigenous people but also to the exporting firms which obtain
profits due the renewable capabilities of the healthy habitat for wild pollinators.
In Figure 1, the H
is the maximum harvest from natural production every year. The
economic question about sustainability is if the exporting firm considers only the
marginal costs of harvesting, given the price P
, when threats such as increasing the
forest fire reduce the capacity of pollinators to provide ecosystem services. i.e.

Original data retrieved from September 2014.

Countries Mean 2004-12 S.D. 2004-12 Growth 2004-12
USA 11,794,666 3,607,385 119.75%
Russia 526,202 707,193 242.52%
Australia 525,163 396,935 166.21%
UK 936,556 680,696 55.84%
Canada 554,311 401,352 136.55%
New Zealand 90,102 201,559 3375.41%
Netherlands 256,807 194,617 -6.05%
Germany 440,688 367,056 -41.32%
Japan 105,427 82,897 189.01%
Italy 145,986 109,275 103.71%
Spain 92,184 115,325 -68.57%


negative externalities happen. Furthermore, the difference of US$ (P
)= P* would
be the price for the conservation of biodiversity in H
hectares needed to avoid that
loss of resilience of the ecosystem.
Also, it is important to observe the minimum supply price where the two lines
intercept, P
is the minimum price that the harvesters require to cover the fix costs
to enter to the forest to collect nuts. Figure 2 presents a basic analysis of harvesting
Amazon nuts using linear marginal costs with a threshold. It implicitly assumes that
the marginal cost of harvesting more Amazon nuts is increasing steadily at a fix until
the carrying capacity threshold.

Figure 2. The threshold for Amazon nuts ecosystem collapse
Winfree (2011) has modelled the pollination has an input for farming companies. We
adapt this, for the exporting firm. Since the reduction of the pollination affects the
exporting firms.

Then, the annual benefit changes this year, when pollination change in the previous
year would be obtained differentiating respect to q

) (

US$ / hectare
= MgC** = C
+ C
F Supply curve considering
cost of conservation of biodiversity
= MgC* = C
E Supply curve without considering
cost of conservation of biodiversity

Minimum given price for the harvester
Pmin to enter to the old-growth forest
to collect Amazon nuts
0 H
Ht ("barricas"/year)


But, as changes in pollination are not considered in the costs, then the last derivate
term of 7a is zero, and we would have:

And, the 500 period benefit accumulated changes would be:

In equation (8), if q
is reduced and nuts prices are taken, then

<0 due to

<0 and/or

>0 (9)
Equation 9 is the negative externality caused by other activities different to the nut
extraction. For example, an increase in forest fires by practices in surrounding lands
that affects cross pollination.
The effect of pollination can be reversed with government refunding exporting firms
that invest in conservation of biodiversity, paying for natural growth of their input.
Through the money they invest for supporting auctions of specific indigenous
communities that show clear results and verifiable indicators such as achieving
organic certification in all the process of Amazon nuts from collecting to transport.
Auctions are cost-efficient to avoid the reduction of ecosystem services. With these
payments, indigenous people can apply forest management practices that maintain
the old-growth forest functions. Paying for conservation through auctions is a cost-
efficient investment. For example, in Figure 2 in Time 0: C hectares would be made
available for conservation. In Time 1, without providing any incentive to conserve, E
has. would be made available for conservation.
From the Figure 1, we have that according to the carrying capacity of the ecosystem,
is the maximum optimal quantity that would be expected to be auctioned for
paying for conservation. From the Figure 2, we can see if the society values the
Amazon nuts enough to get those funds, then the loss of ecosystem functions will be
less as this payment program starts sooner. C is bigger than E, in the example. One
important advantage of this payment program is that not only would allow to protect
an specie, but an entire habitat. In the case of Amazon nuts, already the trees with
valuable species have been extracted, the ecosystem functions continue working.
Other advantage of this payment program is that it is cost-efficient than alternative
models for funders. For example, in Figure 3 if a government or donor provides a
fixed rate scheme (P*) of payment, it would only allowed D hectares for


Figure 3. How much degradation of old-growth forest can society afford? Source: Adapted
from Stoneham et al. (2003)
The analysis made in this paper provides enough support to think in investment for
conservation of biodiversity in habitats than in species. And, in the case of the
Amazon nuts ecosystem in Peruvian Amazonia, the opportunities of investment and
multiple benefits for maintaining ecosystem provision are clear. In this section, we
explore the relevance of this conservation, the reliability and validity of the analysis
made and the future research needs in this topic.
Relevance of Amazon nuts ecosystem conservation
This study has addressed the sustainable biological and economic path of the
gathering of Amazon nuts by the indigenous people from Madre de Dios. It has been
identified from the bioeconomic perspective that a relation between more production
of a non-timber forest product and more biodiversity exists, and this relation does not
happen in the majority of forest products. This is due the explained relation of the
stand Amazon nuts trees that maintain or increase their productivity in a natural
cycle linked with a healthy habitat for the cross pollination in the previous year.
Cross pollination is not affected where it is a healthy environment for the flora and
fauna that contributes for the pollination of flowers and dispersal of seeds.
(industry supply curve for
conservation of biodiversity in
US$/ha Peruvian old-growth forests with
(bids) Amazon nuts, time 0)
(optimal bids, time 0)


0 A D E B C
available hectares for conservation
of biodiversity in Peruvian old-growth
forests with Amazon nuts


The main threats for the provision of these ecosystem services are the increase of
forest fires, the change of land use in surrounding territories and the expected large
negative impacts on the Amazon basin as it has been identified by the last
Intergovernmental Panel of Climate Change assessment (IPCC, 2014).
The indigenous people, exporting companies, government and international
community can act with synergy and develop a strategy that addresses the
conservation problem. Launching auctions with permanent activities, as in Bush
Tender, would provide an adequate incentive for conservation of biodiversity to the
stakeholders linked to the Amazon nuts market. This link is efficient to increase the
supply of conservation of biodiversity and to give the right signals from consumers
for exporting firms, to try to solve market failure and also, to encourage indigenous
people to be more active in the provision of biodiversity conservation. Fulfilling the
requirements for auctions, they will obtain more resources to protect and achieve
fulfilment of their land rights.
After the approval of the Convention on Biological Diversity (UN, 1992), some
authors criticised that payment for conservation of biodiversity from developed
countries should not be discussed first (Perrings, 1994). Here, we have shown that
Amazon nuts ecosystem for indigenous people provides an excellent opportunity for
international funding for conservation of biodiversity in the Amazon.
We have highlight in this paper that the economic motivation of the indigenous
communities in front of Amazon nuts relies more on an ecological economic
perspective. Indigenous communities gather more nuts not for profits, but to continue
having the life they consider valuable to live. We criticise the strategies and policies
that only work in the view of indigenous people as less efficient or less informed
than other Amazon dwellers that practice agriculture, livestock or give more added
value, because they are chrematistic and not holistically economic.
Amazon nuts exported from indigenous territories are five percent of all Peruvian
exports of Amazon nuts. The quantity of trees maintaining their productivity gives an
indicator of the associated biodiversity. So, we can link positively NTFP with
biodiversity. Payment for conservation of biodiversity would provide the indigenous
people with benefits to conserve their knowledge about the conservation of
biodiversity and activities to maintain the provision of ecosystem services. Their work
for conservation will be rewarded with the objective of fulfilled and resilient land
A hypothetical conservation program developed in these territories would be cost-
efficient for international agencies to address the problem of implicit zero economic
valuation and to pay for biodiversity conservation in indigenous peoples territories. It
will allow a change from the barter of Amazon nuts to participate in the building of a
market for ecosystem services. Also, it is a better option than certification, because
with the latter, the upfront payments for organic certification of Amazon nuts creates


more transaction costs and affects the indigenous way of life, creating the need to
invest time in transaction registrations as if they were farmers.
The current organic process does not take into account that the main reason the
indigenous people sell their product is not to create profits, but to maintain the live
they consider valuable to live, and their land rights.
The analysis made in this paper supports maintaining the capacity of the system to
provide ecosystem services for non-timber production from the study area as an
excellent investment opportunity for development countries. They would be for the
maintaining of multiple ecosystem services. The achieved resilience of the Amazon
ecosystems is more important than the reduction of species itself.
The need for getting funds from developed countries for these conservation
programs raises questions about the feasibility of such schemes for developing
countries such as Peru. However, the key to the provision of these conservation
services without government payments is the marketing of these services to provide
credible commitments that they will be provided. Furthermore, Amazon nuts (B.
excelsa), can be marketed as being grown in a manner that preserves biodiversity,
thereby eliciting higher prices and delivering returns to conservation activities.
Finally, the reduction of more external debt can be negotiated in the framework of
debt by nature swaps (Flores et al., 2011).
Reliability and validity
Information to the market about the sustainability of the harvest of a non-timber
forest product that involves indigenous people could be more reliable addressed with
geographical information about the source of the product. For example Amazon nut
from Peru is by default organic. From our field research, the main change was
between before and after certification, it was paper work, income that goes to the
certifier, but not change at all in the process productive. Even the indigenous
communities have to look for NGO help to support them with the organisation for the
paper work. And, we find that the majority of consumers do not differentiate with the
organic label in the majority of nuts retail shops in developed countries. They only
see the generic label Brazil nuts, and do not count with enough information as it
was presented in this paper, to take a better decision in their choices comparing with
other nuts. As this is a preliminary study, the exploration of those trade-offs between
different kinds of nuts with more information of the consumers should be developed.
Limitations of this study include that generalizations cannot be made to other non-
timber forests products in Amazon basin, due the relation between more nut
production and more biodiversity conservation does not exist in all ecosystems.
Furthermore, we know that currently the Peruvian government does not count with
enough technical staff and equipment monitor implementation of the conservation
policies. But, we have highlight that for the studied non timber forest product, the


indicator to measure and validate the policy of auction is the number of stand trees.
It provides an affordable indicator to measure and evaluate this strategy.
Future research
As this paper is a preliminary theoretical approach from ecological economics to
improve our understanding of incentives for conservation of biodiversity in Amazon
ecosystems with non-timber forest products. Then, empirical testing of the model
with updated data should be collected in Peru and in developed countries to provide
more evidence to validate the preliminary conclusions.
Finally, it would be interesting to explore how the strategies should be differentiated
when we have different non-timber forest products, less linked to international
markets and with other non-use values unlinked with indigenous peoples lands and
with non-direct relationships between more production and more biodiversity. Also,
more research more should be targeted at investigating the link between REDD
projects and conservation projects, payment for ecosystem services and trade-off in
megadiverse countries.
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Responses of Migrant Communities to Extreme Heat in South
Australia: A Case study in the City of Port Adelaide Enfield
Tahabub Alam
and Md Younus
School of Earth and Environmental Sciences, The University of Adelaide, South
School of the Environment, Flinders University, South Australia
Extreme heat is already a threat to South Australians especially to culturally and
linguistically diverse (CALD) migrants who are overseas born and brought up. The
IPCC and other Australian and international research evidences have predicted
more frequent hot extremes in Southern Australia that could pose a serious health
risk for the disadvantaged minority communities because of demographic, economic
and socio-cultural factors. In this context, some CALD migrants (e.g. Bangladeshi,
Bhutanese and Sudanese) are thought to be vulnerable to heat due to their previous
demographic, social and cultural orientations. To reduce vulnerability and increase
adaptive response capacity, it is important to study behaviours and responses of the
CALD communities to heatwave. This paper focuses on their efforts to adapt to
hostile climate. The key aim of the study is to appreciate response enablers and
barriers of CALD migrants to extreme heat.
A preliminary qualitative study was conducted with CALD migrants in the City of Port
Adelaide Enfield area involving one focus group discussion and two interviews
including seven participants from three different communities. Using thematic
analysis, the key barriers of CALD communities to heatwave are identified as lack of
English proficiency, acclimatisation, power costs, poor quality housing, and lack of
heat-friendly housing whereas the enablers are marked as their individual adaptive
capacity and strong community networks. These early findings suggest introducing
heatwave financial support and adopting heat-friendly culturally appropriate
sustainable housing projects for the low-income members would assist in adaptation
to heatwaves. It would be beneficial to continue this preliminary case study with
additional interviewees to develop a multilingual heat-health warning system, and
design a heatwave awareness programme.
heat; CALD communities; vulnerability; climate change; response and barriers; City
of Port Adelaide Enfield


The length, frequency, and intensity of heat waves have increased globally, and will
continue to increase (IPCC 2012, 2014).In this context, extreme heat is a threat to
South Australian communities and it may impact on community-health and well-
being at increased rate. Heatwaves have potential to kill more people annually on
average than any other weather disasters yet public attention is less focused on the
potential impacts of heat because of its less prominent impacts on the wider
communities (Carlson, 2008). Fourth and Fifth assessment reports of the Inter-
governmental Panel on Climate Change (IPCC) (IPCC 2007, 2012 and 2014) have
indicated that communities with limited adaptive capacity are particularly at risk from
weather extremes, for instance, heatwaves as a consequence of unequal distribution
of human, social, natural, physical and financial capital across the society. Besides,
adaptive capacity of a particular community to heat can be decreased by
demographic, economic, social, psychological and technological reasons (NCCARP,
2011). Moreover, adaptive capacity is affected by vulnerability which may be
dependent on the local characteristics of communities and populations such as
economic well-being and inequality, and other social factors (IPCC, 2012; Brooks et
al. 2005). Furthermore, the degree of suffering depends on their cultural and social
adaptive behaviours (ONeill and Ebi, 2009). Exploring the responses and
behaviours of communities during hot weather, many studies (e.g. Fothergill et al.
1999) in the US argue that particularly racial and ethnic communities are more
vulnerable and at great risk to heat waves than the mainstream communities. Other
evidence suggests that migrants and ethnic minorities are heat-related vulnerable
populations (Cheng and Newbold, 2010). Other findings also suggest that groups
with low socioeconomic status are increasingly at risks (Basu, 2009; Department of
Health, Victoria 2011) as comfort during heatwaves depends on income, costs of
utility and other economic factors (Semenza et al. 1999). For example, 72% of the
victims of the 1999 Chicago heatwave had incomes below $10,000 p.a. (Naughton et
al. 2002), and in the catastrophic 1980 heatwave in Saint Louis and Kansas City,
low- income groups suffered more than high income groups (Jones et al. 1982).
Generally, renters, recent immigrants, residents dependent on state support, migrant
workers, women, young children, and the elderly and non-English speaking people
are considered vulnerable to climatic hazard (Enarson 2007).
The above evidences raise emerging concerns about CALD communities and their
vulnerabilities to heat in South Australia who are mostly overseas born with non-
English cultural background (Health Department of Western Australia, 2005),
different health characteristics (Australian Institute of Health and Welfare, 2012),
religious beliefs, socioeconomic challenges, social relationships, environmental
factors and health perceptions as they include a range of ethnic groups, migrants,
new communities, refugees and asylum seekers (Emergency Management Australia
2007). It is evidenced that particularly new migrants in South Australia, under refuge-
humanitarian category, have low incomes, high unemployment, low levels


accommodation and are overrepresented among the disadvantaged population
(Hugo et al. 2011). In this perspective, migrants in the CALD communities of South
Australia may face many challenges in the increasing number of heatwaves which
may cause additional social and economic stresses due to many reasons such as
lack of local language and culture, inadequate knowledge of the available services
and unfamiliarity with the local environment (Sevoyan et al. 2013). Obviously this
issue is not only significant for South Australia, since heatwaves are believed to be
the effects of climate change, it is both regional and global concern.
In these circumstances, it is important to know about responses and behaviours of
migrants in the CALD communities to extreme heat for equity issues. Recent
heatwave scenarios and events in South Australia and the impacts on communities
set out the rationale and evidence for the research. Before developing a community-
based planned adaptation process to heatwave, understanding the real barriers and
enablers of the CALD communities and their associated responses is necessary
because underlying vulnerability factors and causes of reduced capacity are
important. Hence, research is needed to investigate the underlying socio-
demographical, socio-economical and socio-cultural reasons behind their difficulties
to respond to heatwave effectively.
The key aim of the study is to explore responses and behaviours of the CALD
communities to extreme heat by using thematic approach. Aligned with the key aim,
the objectives are to find the difficulties faced by the CALD communities, discover
their awareness about preventive measures and examine their perceptions regarding
climate change and its impacts on them.
After surveying the literature, the following research questions were adopted:
(1) What are the factors that influence the CALD communities to coping with
extreme heat?
(2) What are the enablers and barriers responding to heatwave?
(3) How they cope and interact with heatwave and
(4) What support they need to adapt with extreme heat?
From our best of knowledge, this is the first study in a local council area to
investigate the responses of 3 CALD communities to extreme heat events.
Recent impacts of extreme heat in South Australia
Recent heat waves in the South Australian capital city of Adelaide were severe
during the period of 2008 and 2009. In 2008, Adelaide had 15 consecutive days of

C or more and 13 consecutive days of 37.8

C or above. In 2009, Adelaide
experienced the highest 45.7

C and the warmest night on record only down to 33.9

C. The daily maximum temperature was 12-15

C above the normal (maximum

C and minimum 12.20

C which have been calculated from 30 year mean


during the period1961- 1990) over the consecutive five days of 27 -31 January 2009
(National Climate Centre 2008 & 2009). In Adelaide, these recent temperature trends
which can be visualised from the following graph, have likely crossed limits of
communities coping capacity in general as evidenced by the fact that 33% increases
in ischemic heart (Incidence Rate Ratio, 1.33; 95% confidence Interval, 0.99-1.80)
and 37% increases in total mortality (Incidence Rate Ratio 1.37, 95% confidence
Interval, 1.09-1.71) were seen in the 15-64 age groups during the 2009 heat wave
whereas older age groups were unaffected (Nitschke et al. 2011).
Studies in the major cities of the United States and Europe show that the mortality
rate is largely influenced by heat index (Basu and Samet , 2002) for instance in the
United States, extreme heat accounts for the largest cause of mortality followed by
hurricanes and tornadoes (NWS, 2013). In 2003, heatwaves claimed 15000 lives in
France (Fouillet et al. 2006) and led to about 70,000 deaths in 16 European
countries (Robine et al. 2008).
Extreme heat and causes of vulnerabilities of CALD communities
Some studies (e.g. Lindley et al. 2011) hint indicate that the effects of high
temperature may not be the same on the different individuals or community groups
for different conversion factors like personal, environmental and social conversion
factors which determine how positive and negative events are converted into gains
and losses in well-being. The key vulnerability factors including age, socio-economic
status, ethnicity, English proficiency and relative acclimatisation to hot weather
impact on the vulnerability of CALD groups in adapting to extreme heat
(Luber&McGeehin 2008; Cheng and Newbold, 2010). Moreover, lack of access to
adaptation options for lack of skills, may create vulnerability to migrant groups
(Eriksen & Kelly, 2007). Heat impacts can reinforce existing vulnerabilities of
migrants by creating new health risks (increased mortality) and reducing livelihood
options (Christoplos et al. 2009). Within the CALD communities, many in new and
emerging communities have high blood pressure, mental health problems including
grief and loss issues, kidney problems, multiple chronic illnesses and nutritional
deficiencies which may create some difficulties in sweating and regulating body
temperature and may also affect an individuals ability to keep cool during extreme
heat (Hansen et al. 2014, Semenza et al. 1999). Older people in the CALD
communities who lack English proficiency skills may be doubly at risk because it can
exacerbate isolation and deter them from accessing to useful preventive information.
Lack of physiological and behavioural acclimatisation of humanitarian entrants and
older migrants to local conditions can influence mortality risk (Knowlton et al. 2009)
and can be a factor of heat-related deaths in Australia ( Green et al. 2001).
Some of the CALD community members homes are old without any air conditioning
and insulation that may limit their adaptive capacity to heatwave compared to
mainstream community. Besides, social factors like low socio-economic status,
unemployment, financial hardship, lack of driving skills may be responsible for social


exclusion of some CALD group members particularly asylum seekers and new
arrivals and this social exclusion may increase their social vulnerability as well as
reduce adaptive capacity to the impact of extreme weather (Hansen et al. 2014,
Sevoyan et al. 2013).
A qualitative methodology was chosen because of its ability to describe and explain
a persons experiences, behaviours, interactions within the context of social, cultural
and political factors in the issue (Strauss and Corbin 1990; National Health and
Medical Research Council 1995). Qualitative methods are participant-friendly (Popay
et al. 1998) and flexible and can help the researcher to attain insight to the persons
subjective meaning, actions and context with respect to any suitable theme related to
the research questions, as well as uncovering any new theme. As the interactions
and the responses of the CALD communities to heat are multi-dimensional, thematic
analysis was used to discover the subtle barriers and drivers that can influence
individual and community vulnerability and resilience respectively. Different themes
were selected to capture these ideas in relation to the research questions. The
central theme was the response issues (the enablers and barriers) of the three
different CALD communities and the other peripheral themes which were
demographic, socio-economic and environmental factors.
Framework of the qualitative study
Two-fold strategic targets were addressed such as setting a way of reaching the
target communities and developing an interview topic guide. Community
organisations and some secondary contacts were used to enlist the participants. An
interview topic guide was developed in keeping with the aims of the study. The
qualitative research approach comprised of interviewing, analysing, synthesising and
report writing. Interviewing included sampling and organising the participants and
preparing the interview guide. Transcript preparation and recorded data analysis
were part of the analysing phase.
Snowball sampling was used in this study as it was difficult to access or approach
the target groups. A convenient (with time and availability) sample of CALD group
members was selected as the participants of the focus group discussion and
interviews. Three different communities were chosen: Bangladeshi, Bhutanese and
Sudanese. Five Bangladeshi community members took part in the focus group
discussion. One Bhutanese and one Sudanese community members participated in
individual interviews. Respondents were from different backgrounds such as skilled
migrants, refugees and long-time resident in South Australia as shown in Table- 1.
The residential period of the participants varied from 1.5 to 40 years in South


Participants were sampled from the City of Port Adelaide Enfield due to its socio-
cultural and socio-economically diverse population (City of Port Adelaide Enfield
2011). A high proportion of CALD groups with refugee and humanitarian
backgrounds live in Port Adelaide Enfield with 26.2% of its residents being overseas
born, while 29% speak languages other than English at home; 4% higher than the
national average (City of Port Adelaide Enfield 2011 and 2008, Australian Institute of
Health and Welfare 2010) . The Bangladeshi community participants were
approached through community organisations. The organisations conveyed the
message to their members and interested persons communicated directly to
participate voluntarily. The Bhutanese and Sudanese community participants were
recruited through a secondary contact. All respondents were assured of
confidentiality and anonymity.
Table 1: Participants characteristics
Name of the
Number of
Male Female Background Type of
5 3
Skilled migrants
residents in South
Focus group
1 1 - Refugee Individual
1 1 - Refugee Individual

Data collection and analysis
Data were collected during the period of August 2012 to September 2012. Three
meetings were held in three different places. A focus group discussion of 50 minutes
was held in the meeting room of the Port Adelaide Enfield City Council library. One
interview of 25 minutes was held at a respondents workplace and one at the School
of Public Health, University of Adelaide, for 40 minutes. Before starting the
discussion and interview, every participant was informed about the research
objectives and provided written consent. The interviews consistently followed the
interview topic guide which included open-ended simple questions.
Next, the participants were encouraged to explore their perceptions relevant to the
research topic. They were given ample time to discuss their points of interest with
clarity. The respondents revealed their perceptions about climate change and
extreme climatic events spontaneously. The focus group discussion and the
interviews were recorded digitally and transcribed verbatim into text and the


speakers are de-identified. The transcribed data were compared to their audio part
carefully to ensure accuracy. Note-taking and field-notes were also maintained for
appropriate analysis.
In analysing the data set, four themes emerge, in accord with the research questions
and the broader assumptions of the socio-demographic and socio-cultural
differences from the mainstream of CALD community members. These themes are:
(1) personal conversion factors (a variety of biological factors and associated factors
like age, premedical conditions, and years lived in South Australia, local language
proficiency, mobility and adaptive capacity), (2) socio-economic factors, (3)
environmental factors and (4) response issues. The codes that are associated with
the themes are shown in Table 2. The content of the codes is subjective and may
often interlink and/or sometimes overlap with the identified themes.
Table 2. Identified codes with four main themes
Personal conversion
Response issues
Particular health
Years lived in South
English language
Preventive awareness
Outdoor workplace
Adaptive capacity
Poor quality
Price of electricity
Financial issues
Green space
Unfamiliar weather
Elevation of residential
Enablers: community
networks, heat-type, cold
water supply, beach,
adequate weather
information, cool-built
environment adaptive
behaviour and community
Barriers: income, language,
cultural factors, cool foods,
shopping centre as cooling
place, housing design,
financial issues, solar
rebate, community housing/
government housing,
warning message barrier,
community speakers on TV

Personal Conversion Factors
Eight key personal conversion factors were identified as stated in the Table 2 which
may impact on CALD migrants. Its impacts are described under 4 subthemes as


1. Age and particular health condition
Children and aged people in the CALD groups are vulnerable to heat due to age
factors which might limit their heat regulating mechanisms, and mobility compared to
other age groups people. Besides, pregnant women and people with pre-medical
conditions such as diabetes, hyper tension and other long term illnesses are also
labelled as vulnerable for their reduced ability to keep cool during hot weather
period. One respondent added I think, the effect of extreme heat in the new
country is basically borne by aged people... (Bhutanese community member) to
highlight the degree of adversity experienced by older people in the migrant groups
at extreme heat.
2. Length of stay in South Australia
Length of time as a resident in South Australia was appreciated as one of coping
factors to get adapted with the highest maximum temperature like 43

C. A
participant from Bangladeshi community expressed that although he felt too much
hot when he first arrived in South Australia but after residing 3 years here, he has
learned to cope with 40

C or more. Another CALD group member spoke of
importance of residential time in South Australia in this way: ... length of time is a
factor, because we are still adapted where we come from, so we are on the process
of adapting to the situation... (Sudanese community member).
3. English language proficiency
Lack of English proficiency, another personal conversion factor, can be a barrier for
some CALD members to face hostile hot weather by limiting communication with
neighbours and wider communities and barring access to any heat-related
warnings and services. Sometimes the people having poor English proficiency do not
show their interest in going to the cooled spaces like shopping centres to keep them
cooler which may increase risks of mortality and morbidity. One respondent
emphasised the language barrier with Language is the factor that doesnt
encourage them to come out of the house (Bhutanese community member).
4. Adaptive capacity
Individual adaptive capacity of the CALD members depends on some factors like
mobility, awareness of preventive actions and job types. Some community members
particularly newly migrants had limited mobility as they did not own a car or lack
driving skills that reduced their adaptive capacity to extreme heat. Referring this, one
respondent noted that some community members cannot go to cool places due to
lack of driving skill. Unawareness of preventive actions that can protect heat
adversity, for example, fluid intake to keep hydrated during hot weather, creates
health issues including kidney stone, headaches and constipation to some
community members. One participant described community ignorance about


preventive actions: Our communities not, not all of them are fully aware of what
needs to be done. For example, drinking adequate amount of water is very
important in very hot weather and our people are not much very used to that one.
So, that has been one issue, basically awareness thing... (Bhutanese community
The discussions also revealed that some outdoor strenuous jobs such as fruit and
vegetable picking and road construction works during extra hot weather add extra
heat- discomfort to the workers who are mostly from CALD backgrounds.
Expressing feelings from personal experience, a participant supplemented, ...when I
work in the outdoor in the summer 41/42 degree temperature I feel very
uncomfortable still (Bangladeshi community member).
Socio-Economic Factors
Six key factors were identified under this theme which are interlinked with the
increase of vulnerability of the CALD communities during hot spells. These include
housing quality, income, power costs, financial issues, low socio-economic status
and social isolation. The influences of these factors to CALD members which limit
their adaptation strength to settle in South Australia are presented under 3
1. Low socio-economic status, electricity costs and housing
Narratives revealed that people from migrant groups particularly from refugee and
humanitarian streams are often unable to gain employment due to poor educational
attainment that creates financial disadvantage and curbs their capacity to face
heatwave. A respondent from refugee background stated many people are not
educated... they dont go out for jobs or schools, they stay at home because they
dont have enough money ... (Bhutanese community member).
Low socio-economic status can be linked with low income and low income is
associated with poor housing. Low income earners also may not be able to pay extra
electricity bills for air conditioning over an extended period of time during heat wave.
One respondent spoke of their poor income which is too less to manage the cost of
air condition plus other expenses. High cost of electricity consumption, again
related to financial ability, was raised as a major barrier to air conditioner usage. The
effect of electricity price was stated: Now the electricity price is going too high
and every night if we turn on our air conditioner, we have to think to cut down air
condition timing. (Bangladeshi Community member). Families with low- income in
the CALD groups are likely to be over-represented in the low-quality rental housing
having no fan, and no air conditioner. Most respondents mentioned that tenants of
houses with poor ventilation and little investment in energy efficiency are likely to be
the most affected by the warming climate.


2. Social exclusion
It was revealed that strong social and family connections prevail in the CALD
communities, however, poor English, financial issues, mobility and other related
factors can lead to individuals or families becoming socially excluded. One
participant expressed his views about isolation, they have no language, and they
cant go out and go to the shade, and go to the park.t. So they have to stay
indoors... (Bhutanese community member). Moving to cool places during heatwave
might be associated with costing such as fuel cost and transport fare, and this
costing may discourage the community members with economic exclusion. In the
context of older people, one respondent expressed his confidence that clustered
living of CALD communities may reduce their (older peoples) vulnerability to hot
weather periods by sharing feelings with intra-community neighbours and was
pleased: I thinkat least the older people now have some access to another older
person with clustered living in small scale. (Bhutanese Community member).
3. Environmental Factors
Respondents discussed the issues including housing characteristics, physical
attributes of the neighbourhood such as amount of green space, and unfamiliarity
with South Australian heat under this theme. The 3 subthemes under Environmental
factors are described as follows:
4. Housing characteristics
The location, type and quality of housing can influence extreme heat impacts on
general as well as CALD community members. Housing near the beach may be
comparatively cooler with respect to other locations but it is beyond the affordability
of most of the CALD members for their low socio- economic status. One respondent
pointed out about reducing heat impacts: it depends on where you live to get a cool
breeze that takes the temperature down at least by 10.... (Bangladeshi community
The building materials have influence on extreme temperature controlling such as
solid brick houses, double brick houses, they keep much cooler in summer than
modern brick big houses. Identifying the shortcomings of the present building
design principles which are not mostly hot weather-friendly, one participant
suggested, ...the way the houses are built, they need to put some sort of things that
will protect heat... (Sudanese Community member).
Elevation of residential buildings may cause increased vulnerability to heat as top
floor of the building gets warmer than that of the ground floor. Regarding this, one
participant suggested, the authority needs to take steps for the people who live on
the top floor of the building because if heat gets straight into the room and then
there is no way can go (Sudanese community member).


5. Green space
The discussion explored that green space in front of the houses can reduce the
temperature gradient between inside and outside during extreme heat. One
respondent described his own experience about natural cooling, ... if you have a
very large tree, couple of trees in front of your house...., it keeps ...,the temperature
down at least by 10. (Bangladeshi Community member).
6. Unfamiliar heat
Most respondents agreed that the type of heat in South Australia is somehow
different from that of their country of origin, because of dry heat, they do not sweat
and feel thirsty which creates health sufferings, for example, urine infection.
Particularly newly arrived migrants face this heat acutely due to unfamiliarity as ...
the heat, the type of heat in Australia, in South Australia is quite different from the
heat in Nepal and Bhutan (Bhutanese Community member). In contrast, one
respondent expressed his good feelings with this dry heat: Actually I feel better than
my country..., here I dont sweat... it is very comfortable (Bangladeshi community
member) which is just an individual physiological difference.
Response Issues
Issues raised through the CALD community members can be divided into two
groups: enablers and barriers, as shown in Table 2. Enablers may include
community network, cold water supply, beach access, adequate weather
information, cool built environment and adaptable behavioural pattern. On the other
hand, key barriers may include low income, lack of English proficiency, poor rental
housing, cultural factors and lack of access to heat warning services. The enabler
and barriers of the CALD communities to heatwave and some suggestions from the
respondents are described in the following Tables 3, 4 & 5:
Table 3. Key enablers contributing to increase adaptive capacity to extreme heat in South
Issues Impacts on CALD communities
Community network Most participants spoke of well-connected strong community networks
in CALD communities which may be helpful to deal with heat as its
easier for us to create awareness among community.... (Bhutanese
Community member).
Cold water supply and
beach access
Availability of cold water supply in the houses and beaches in South
Australia are supportive to reduce heat impacts in this way: When we
feel very hot, then we just feel like having more water or fluid at the
same time, getting two -three times bath in a day that becomes us
happy... (Bangladeshi Community member).
Adequate weather Respondents spoke of adequate weather information regarding heat


information warning messages from the Australian media which helps them to take
preparation against heatwave even getting every individual suburbs
climate update, every hour basis
Highly adaptable
Strong commitment to settle in South Australia makes most CALD
members highly adaptable to hostile heat: We have made the choice to
come to Australia and we have to live with it... (Bhutanese Community

Initiatives We are planning to reduce the heat of our houses by making our
investment slowly, like we put the solar panel, so that we can use
more fans frequently. (Bhutanese Community member).

Table 4. Key barriers contributing to increase vulnerability to extreme heat in South Australia
Issues Barriers
Low income A barrier to pay electricity bill, rent heat-friendly housing, install air
conditioning in living places and pay cost of fluids that may decrease
response capacity of the CALD community to heat. If you cant actually
turn on your air conditioner, how you can cope? (Bangladeshi
community member).
Language barriers and
low literacy
Most respondents spoke of language barrier that lacks some
community members access to warning information on extreme
weather events from the media, including TV and Radio news. They
have to depend on their children for understanding of warning
Cultural factors Cultural factors such as sleeping patterns, mealtimes, foods and
dresses are seen as barriers for families adjusting to heatwaves: My
wife and then my baby, they cant sleep in standard hour; In our
country most of the lady, everybody, is used to very covering dresses
and then head covers and the full sleeves (Bangladeshi Community
Some CALD communities believe half-shorts are poor peoples dress
that are commonly used for summer dress. Lack of cultural practices
like in Sudan, we use shadows and open places to keep cool but here
if you dont have some facilities, it becomes problem... (Sudanese
community member).
Housing design Design and size of houses may be barriers to respond heatwave as
most of the renting houses are designed for 3 bed rooms which may not
be sufficient for big families as some CALD community members are
blessed with 5 or more children. ... In our country the houses are very
big and wide and most of the rooms have very wide ventilation!


(Bangladeshi community member).
Unavailability of cool
Unavailability of some foods like tropical fruits and vegetables that may
have potential to influence body temperature during hot weather period
is recognised as response barrier to heat. I try to search the cool
food but thats not like our country, thats a problem to cope
(Bangladeshi community member).

Table 5. Key suggestions from CALD community members contributing to address response
barriers to extreme heat in South Australia
Issues Suggestions
Reviewing housing design any accommodation, the housing has to be reviewed, the
government has to put more investigation of houses that people are
living in, whether they are heat-friendly for the people to live in
(Sudanese Community member).

Subsidised electricity bills Respondents suggested subsidised electricity bills for the low-
income families to afford air conditioning during heatwave. Low
income earners should get some subsidy in their electricity bill
particularly (Bangladeshi community member). Rebates also need
to install solar panel as well for affordability.
Newly arrived migrants ..If any migrants come in Australia in summer time, definitely
should have it, they have (been) provided three to four months
government housing which is fully equipped ... (Bangladeshi
community member).

Community media Community TVs and Radios can convey heat warning messages in
different community languages along with English. Main stream
media like ABC ( Australian Broadcasting Corporation) and SBS (
Special Broadcasting Service, Australia) can also engage
community presenters to broadcast heat warning bulletins:
message go across but if you say that we have to stick to the
mainstream language, we dont know English, bad luck, I think
(Sudanese community member).

All participants belong to CALD communities who are the residents of the City of Port
Adelaide Enfield in South Australia. They entered Australia via different routes


including skilled migration process, on humanitarian grounds or as postgraduate
students. This qualitative study has flagged some new insights into response issues
relating to housing characteristics, the adaptive capacity of the CALD group
members and their strong community support links. The implications of extreme heat
on the various CALD communities and their responses are accommodated within
four broad-based themes. Many factors are subjective and overlap within the
different themes, though the dimensions differ.
The responses validate previous research findings that age can influence heat-
vulnerability, e.g. Flynn et al. (2005), while Kovats et al. (2004) found older people
and small children may be more vulnerable to heat due to their comparatively weak
thermoregulatory systems. Another evidence is, during the 1995 Chicago heatwave,
73% of the victims were over the age of 65 (Touleman and Barbieri, 2005) which
supports age factor. It is suggested that the language barrier may be a significant
barrier to coping with extreme weather events (McGeehin and Mirabelli, 2001) and
similarly in the present study, it is apparent that due to limited English some CALD
members did not receive warning messages from media during heatwaves.
Schuman (1972) pointed out that poor quality housing may increase morbidity and
mortality during heatwaves. The present study finds that factors like housing
characteristics, income, rising cost of electricity, poor access to air conditioning
systems and socio-economic status influence the CALD community members
coping capacity. ARUP (2008) note that when residential buildings are not adapted
to extreme weather conditions, heatwaves may cause discomfort and lead to
disrupted sleep and loss of productivity (ARUP 2008). Other studies also have found
that ventilation and window systems may cause heat-vulnerability (Vandentorren et
al. 2006), while tree shading reduces surface temperature by 15-20

C and the air
temperature by 5-7

C and can significantly improve human comfort (Ennos 2011).
In Adelaide, South Australia, it has been observed that trees cool the ambient
temperature by up to 10

Many studies show that residential air conditioning can be a strong protective factor
against heat-related deaths (Son et al. 2012; Naughton et al. 2002). Inability to pay
air-conditioning bills, low income and high energy costs reported by the South
Australian CALD interviewees may reduce their adaptive capacity, as in the Chicago
heatwave study when many of low socioeconomic status preferred enduring heat to
incurring large bills for air conditioning ( Klinenberg, 2003) leaving them at higher
It is observed that people who live on the top floor of buildings are more vulnerable
to heat because heat is easily transferred through thin roofs (McGeehin and Mirabelli
2001, Semenza et al. 1999). The South Australian findings concur with Lara et al.
2010 that people who work outdoors are commonly more exposed to heat and as a
result, their vulnerability may increase. The research findings suggest that change of
housing design can reduce present heat-vulnerability of the CALD groups.


Incorporating the new design, houses can be protected from overheating by reducing
heat gain through windows and through warming of external surfaces (ARUP 2008;
CSE 2011; Porritt et al. 2010).
Apart from housing design, social and cultural contexts also play a significant role in
perceiving and responding to heatwave (Tillett, 2011). The interviews and
discussions with the participants suggest there is good communication within and
between the Adelaide CALD communities of different nationalities. The results
suggest that unfamiliar weather pattern and delayed acclimatisation can be a major
barrier to adaptation to their new surroundings supporting the findings of Kalkstein
(1993). Several participants proposed subsidised electricity bills for newly migrated
low-income community members. This recommendation endorses policy that exists
in some states of the United States: in 2007, 16 states initiated cooling related
energy assistance programs (LIHEAP, 2008).
The language barrier is identified as a key barrier to adaptation to extreme heat for
the Bhutanese and Sudanese community members, because most of them are
settled here on humanitarian grounds and did not have the opportunity to learn
English. A participant has suggested that community leaders or representatives
could be invited onto community TV programs to convey the warning messages to
their respective communities in their own language. This issue does not affect the
Bangladeshi community as much, because most Bangladeshi community members
migrate to Australia within the skilled migration process and studentship.
Acclimatisation to the unfamiliar seasonal weather pattern in Southern Australia is
the main issue for the Bangladeshi community, since they are habituated to a
succession of six different seasons particularly a long rainy season and are
unaccustomed to the dryness of the long hot South Australian summer...
The strength of this study is that the participants have been able to provide clear
information about their personal experience regarding the research topic as well as
they could articulate their perspectives on relevant issues (Morgan 1997, Krueger
and Casey 2000). The sample, though small, recognises the distinct national,
cultural and socioeconomic characteristics of the CALD communities interviewed in
Adelaide. They are keen to contribute ideas to remedy a major difficulty they
unexpectedly encountered upon arrival in their adopted home - the difficulties of
coping with extreme heat. Along with the mainstream media, community leaders or
representatives from a community could be invited by community TV programs to
convey the warning messages to their respective communities in their own language.
One of the main limitations is that the study has been conducted in the month of
August and September when it was mostly cool weather. As a heatwave may be
unpleasant and hence a less than memorable event, it may recede quickly from the
participants collective memory (Carlson 2008). The study season may then affect
the data input and conclusions - this view is reflected in many other studies, such as
Banwell et al. (2012) and Abrahamson and Raine (2009).Another limitation is the


time constraint, in this case 14 weeks. If more time would be available a larger
number of CALD communities could be engaged for interviews and focus groups.
Availability of interested respondents is another constraint. Diversity restricts
understanding the views precisely because sometimes it is difficult to recognise a
range of English accents or dialects (Small et al. 1999). Snowball sampling process
may have different drawbacks like bias sampling because of its non-random and
non-heterogeneous characteristics and may influence the findings of the study.
Thematic analysis is carried on with subjective meaning of the data; it may have
various interpretations depending on the expectations of the researchers. The
number of community respondents may be considered a limitation of the study.
Three communities and seven participants may not be sufficient for generalisation of
CALD communities in South Australia. A minimum three to four focus groups
(Morgan 1997, Krueger and Casey 2000) with optimally five to ten individuals in each
group (Krueger and Casey 2000) are recommended, -however useful indications can
be obtained with fewer participants (Mclinnes and Ibrahim 2010)
The findings are important in many ways as it indicate useful indication for
sustainable social adaptation planning and CALD community adaptation planning.
This study attempted to understand the adaptation process of CALD communities to
extreme heat. The results may help state and local authorities to explore the
problems. Additionally, it can be the basis of conducting further research. This
research has been conducted within limited range because of time constraint and
unavailability of interested participants. To further explore the perceptions of new
migrant communities, an optimal number of focus group discussions and interviews
with increased size of samples would be needed.
Conclusions and recommendations
Using a qualitative approach, this preliminary study has identified and explored some
aspects of response enablers and barriers through discussions and interviews with a
small number of representatives of three CALD communities to extreme heat events
in the City of Port Adelaide Enfield, South Australia. The strong adaptive capacity of
individuals and intra-community networks are seen as enablers, while the identified
barriers are lack of English language, acclimatisation problems and the unaffordable
costs of electricity. Some members of the CALD communities, particularly from
refugee backgrounds, experience a language barrier to their access to heatwave
information. Most newly arrived migrants experience suffering during heatwaves.
The soaring price of electricity is a barrier for low-income members to maintain more
acceptable air conditions. Due to low socio-economic status some migrants have to
live in cheap renting houses with poor ventilation, low ceilings, inefficient and
ineffective insulation and window systems which may not be heat-friendly. This study
has gathered some knowledge, perceptions and emotional responses of the
respondent communities regarding their reactions to extreme heat events and
climate change. Some proposals are recommended, such as introducing financial


support for low-income members to meet extra costs of electricity and fluids,
adopting culturally appropriate heat-friendly housing design and developing a
heatwave health awareness programme. The findings are completely consistent with
other national and international studies, but an expanded study with more
participants from these and other culturally and socially diverse countries would
possibly tap into additional and innovative strategies.
More comprehensive efforts are needed to gather response characteristics of other
CALD communities to address extreme heat events effectively and efficiently. By
taking some short- and long-term strategies, vulnerability of the CALD communities
can be reduced.
In the light of the findings, we recommend the following some short- and long-term
strategies to assist CALD communities to adapt to extreme heat (Table 6):
Table 6. Recommendations for the governments at different levels
Type of strategies Issues to be addressed Implementing authority
Short-term Heatwave allowance to assist low-
income CALD group members for
gaining access to air conditioning and
purchasing fluids
Federal government and State
government (for concession power
payments specifically during
Community media for broadcasting
heat health warning messages in
different community languages
State government & Federal
government and Australian National
Media with the help of CALD
Community organisations
Cool Homes initiative such as City of
Melbourne (City of Melbourne 2012)
Local Government
Culturally appropriate Education and
Outreach programs for building
awareness about heatwave preventive
State government and Local
Temporary heat-friendly
accommodation for newly arrived
Local government
Long-term Initiating energy-efficient, weather-
friendly, culturally appropriate
sustainable housing projects for the
low-income CALD group members.
Surrounded by green spaces, houses
would be facilitated with solar panel,
micro wind turbine and biogas for
renewable energy generation. Besides,
both mechanical and natural cooling
Local government with the financial
assistance of Federal government
and State government.


systems with improved solar control
ventilation, ground, evaporative and
radiant cooling options might be
incorporated. This would help to save
energy costs, reduce carbon emissions
and improve local microclimate.

Effective engagement with the CALD communities to enhance their understanding of
heatwave impacts and its preventive actions is required as part of both short and
long term strategies. Community members can then learn to make their own
heatwave plans and become more resilient and well-adapted to the climate of their
new environment.
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Relationship between economic development and pollutant
discharge in Southeast Queensland

Yoshiaki Tsuzuki

Faculty of Engineering, Architecture and Information Technology (EAIT), The
University of Queensland, Australia
Research Centre of Coastal Lagoon Environments (ReCCLE), Shimane University,
E-mail:; Ph: +61 7 3365 3912

Some relationships between economic development and pollutant discharge have
been found to be represented by inverted U-shaped curves, namely the
environmental Kuznets curve (EKC), while S-shaped and N-shaped curves have
also been found. There are several hard and soft measures to improve water quality
in the rivers in Southeast Queensland. Socio-economic conditions related to river
water environment in Australia and Japan have similarities and differences.
Comparative investigations have not been conducted so far. In this research, first,
qualitative comparisons of the measures to improve the river water environment in
Australia and Japan were conducted. Second, the relationships between economic
development level and pollutant discharges in Southeast Queensland from 1960 to
2012 were investigated. Pollutant discharges from diffuse sources were estimated
based on the existing research results. Effects of precipitation variations were
included by introducing the precipitation variation coefficient (PVC) for the diffuse
source pollutants. Pollutant discharges from point sources were estimated based on
the National Pollutant Inventory (NPI) and the Queensland Government data. The
relationship between purchase power parity based gross domestic product (PPP-
GDP) per capita and pollutant discharges per capita (PDC) of TN and TP were found
to show inverted U-shaped curves especially when the precipitation effects were not
included. Higher economic development levels of the inflection points than those of
the existing research results suggested that the inflection points in the Brisbane
River Catchment found in this research should correspond to the pollutant discharge
reductions from point sources in the 2000s. The exceptional inverted U-shaped EKC
of PDCs in the Yamato-gawa River Catchment, Japan, on the curvatures of the left
and right halves of the curves showed the effectiveness of the hard and soft
measures for pollutant discharge reduction.
economic development; flood infiltration system; pollutant discharge; precipitation
variation coefficient (PVC); purchase power parity based gross domestic product
(PPP-GDP); stormwater harvesting project


From water environment conservation perspectives in Southeast Queensland (SEQ),
applications of fertilisers and agricultural chemicals, increase of livestock, and land
and urban development have caused enormous terrestrial pollutant discharge
increases over 100 years including the Brisbane River Catchment (Neil, 1998;
Dennison and Abal, 1999; Olley et al., 2006). Therefore, it is worth investigating the
relationship between the economic development and pollutant discharges.
An inverted U-shaped curve for the relationship between income level and income
inequity has been proposed by Kuznets as a hypothesis (Kuznets, 1955). In the
1990s, the inverted U-shaped curve has been applied to the relationship between
economic development level and environmental burdens, and named the
environmental Kuznets curve (EKC) (Grossman and Krueger, 1991, 1995; Dasgupta
et al., 2002). Because of the extensive concerns and interests in climate change,
relationships between economic development and amounts of greenhouse gas
(GHG) emission, especially carbon dioxide (CO
), have been investigated by many
researchers with several frameworks of area, location and duration of time. For the
relationship between gross domestic product (GDP) per capita and CO
log-scales are sometimes applied for the investigations, and symmetric inverted U-
shaped curves are not necessarily observed while parabola equations usually apply
(Booth et al., 2013; Liao and Cao, 2013).
In the developed countries, the EKC relationship for CO
emission and GDP per
capita has been found only for southern European countries but not Asian-Pacific
and northern European countries (Mazzanti and Musolesi, 2013). Following the
economic downturn in the former Soviet Union (FSU) countries, affluence and CO

emission has decreased in the 19901995 collapse period, and affluence has
increased and CO
emission has been stable or increased in 19962010 (Brizga et
al., 2013). For CO
and GHG emissions from 22 developing countries in Asia, Sub-
Saharan Africa and Latin America, N-shaped relationships have been found for each
region and all the countries (Babu and Datta, 2013).
In the energy sector, the results have been divided into countries with and without
energy source transformation from fossil sources to nuclear and modern renewable
sources (Burke, 2012). For the effects of economic development on the
environmental burden related to transportation, the relationship between GDP per
capita and sulfur dioxide (SO
) and suspended particulate materials (SPM)
emissions and the number of accidents have resulted in the inverted U-shaped
curves. On the contrary, SO
and SPM emissions, energy consumption, and the use
of private vehicles have been found to monotonically increase with economic
development, while nitrogen dioxide (NO
) emission has been found to decrease
with economic development in Tunisia for 19892008 (Mraihi et al., 2013).


The theoretical explanations of the EKC have been investigated for pollutant
generation, pollutant-specific generation of industrial sectors, pollutant discharge
reduction technologies (Jing et al., 2013), net economic growth effect, scale-
technique effect and time-series emission properties (Andreoni and Levinson, 2001;
Lai and Yang, 2014). Theoretical considerations based on the EKC research have
included private property rights, the role of institutions and rules, respect and
enforcement of contracts, the efficiency of the bureaucracy, the efficacy of the rule of
law, the extent of government corruption, the risk of appropriation, the not-in-my-
backyard (NIMBY) situation and a general model including other exceptions than
the inverted U-shaped curve (Knack and Keefer, 1995; Ansuategi and Perings, 2000;
Yandle et al., 2004). When multiple countries and regions are considered, the
concept of the EKC is related to the pollution haven hypothesis (PHH). Liberalisation
of trade has been considered to be effective to reduce water pollutant discharges
based on a provincial-level analysis of China in 19871995 under the conditions of
pollutant discharge levy systems (Dean, 2002).
Research into the application of the EKC has been made for free trade and open
economies in the 1990s and 2000s. The effects of open economies such as the
North America Free Trade Agreement (NAFTA) on environmental pollution have
been one of the major concerns in the research related to EKC (Grossman and
Krueger, 1991; Cole, 2004). When the EKC exists, economic development of several
countries, including both developed countries and developing countries, would lead
to decreases of environmental burdens in such countries. Criticism for this
hypothesis includes that economic development could lead to more pollution. Some
research results show S-shaped or N-shaped curves, an environmental burden
decrease after the first inflection point and a further increase after the second
inflection point (Yandle et al., 2004; Chen and Wang, 2013; Wang and Wei, in press).
These curves have also been discussed in the contexts of the EKC. Other factors
which have been considered to explain environmental burden include education and
inequity, which have been found to be significant (Hill and Magnani, 2002).
However, there are also results which have not supported the EKC hypothesis
(Perman and Stern, 2003). Individual and panel cointegration tests have not
supported the EKC hypothesis. Monotonic relationships and U-shaped curves have
been observed for some parameters in some existing research (Table 1) (Perman
and Stern, 2003; Tsuzuki, 2009a; Mazzanti and Musolesi, 2013; Mraihi et al., 2013).
The subject matters of the EKC hypothesis have also included topics other than air
pollution, water pollution and solid waste discharge, e.g. the relationships between
economic development and deforestration (Bhattarai and Hammig, 2001; Culas,
2007), climate change, biodiversity and ecosystem services in European forests
(Ding and Nunes, 2014), economic development and the number of animals killed
(Morris, 2013), CO
emission per GDP and the Gini coefficient (Petri and Thomas,
2013), urbanity and direct and indirect CO
emissions (Ala-Mantila et al., 2014),
human health, irrigation and water sector development and agricultural land-use


patterns (Yandle et al., 2004), and ages and CO
emission in the USA and France
(Chancel, 2014).
Accumulation of empirical evidence is necessary for further theoretical development.
For water pollutant discharges, the evidence has still been limited compared to air
pollutant emissions such as CO
and GHG emissions. Economic development
relates to the human and natural causes affecting river water quality. The water
environment management in many areas has been improved from technological,
regulative and institutional aspects based on the socio-economic conditions.
Therefore, evaluations of chronological alterations are necessary to enhance
understanding of the relationships between economic development, pollutant
discharge and river water quality.
Discussions on the EKC include whether the EKC exists or not, and also what the
economic development level and environmental burden of the inflection points or
turning points actually are (Table 1). The inflection points are usually evaluated with
per capita income indicators. In the 1990s and the early 2000s, the inflection points
have been calculated to be USD 4,0005,000 for air pollutants and USD 3,000
10,500 for water pollutants at 1985 prices (Grossman and Krueger, 1991, 1995).
Economic levels of the inflection points in most existing research have been USD
3,00012,700 (Table 1). There have been some exceptional results such as USD
1205,700 in the Southeast Asian countries (Saboori and Sulaiman, 2013), and USD
400 and 117,000 for the cross-country analysis on SO2 emissions (Perman and
Stern, 2003). For water pollutant discharges, USD 13,300 for chemical oxygen
demand (COD), USD 5,600 for total nitrogen (TN) and USD 11,600 for total
phosphorus (TP) have been found from the chronological investigations in a
Japanese catchment (Tsuzuki, 2007, 2009b). For the cross-country investigations of
developing countries, USD 2,2005,100 for biological/biochemical oxygen demand
(BOD) and USD 11,000 for TP have been found (Tsuzuki, 2008, 2009a). Pollutant
discharge indicators are theoretically more reliable for the EKC analysis because
water quality indicators are affected not only by pollutant discharges but also several
other natural and socio-economic conditions (Tsuzuki, 2007, 2009b). After reaching
the inflection points, the curvatures of right-half curves may be smaller than those of
the left-half curves (Figs. 1 and 2 of Burke, 2012; Fig. 1 of Liao and Cao, 2013). This
might suggest the curve of the conventional EKC shown in Fig. 1 of Dasgupta et al.
(2002). An environmental burden has also been suggested to decrease to the same
level with the beginning after the economic development and to continue the small
level after that, which is approximated by a third-order equation (Du et al., 2014).
For the relationships between economic development level and pollutant discharge
per capita (PDC), chronological relationships in the catchments of Lakes Shinji and
Nakaumi, Japan, between 1955 and 2000 have been found to be of inverted U-
shaped curves for COD, TN and TP (Fig. 1) (Tsuzuki, 2007, 2009b). Cross-country
panel data analysis for the coastal areas of Asia, Africa and Pacific countries has


Table 1. Inflection points of some existing research on the environmental Kuznets curve (EKC) for the relationships between economic
development and environmental burdens

No. Author Year Country Duration Environment parameters Socio-economic parameters Specific sector EKC was observed (Parameter, area or
EKC was not observed (Parameter, area
or method)
Inflection point (USD) Specific methods
1 Wang, Wei in press China, 30 major cities 2006-2010 CO2, Energy consumption N-shaped curve N-shape: 12,052 and 12,341
based method
2 Booth, Hui, Alojado, Lamet al. 2013 World 2000 Dioxin Dioxin emission 9,500
3 Chen, Wang 2013 China 2001-2010 Urban green space, Urban green
space coverage
GDP per capita Urban green space: N-shaped curve N-shape: 8,137 and 17,209
4 Mraihi, Harizi, Alaouia 2013 Tunisia 1989-2008 CO2, NO2, SO2, SPM, energy
consumption, accidents, use of
private vehicles
Transportation SO2, SPM, The number of accidents Monotonical increase: SO2, SPM, energy
consumption, use of private vehicles; and
L-shaped downward curve: NO2.
SO2, SPMand the number of accident:
5 Mazzanti, Musolesi 2013 Developed countries CO2
GDP per capita North Europe Coallition (Asia-Pacific), South Europe 9,900-14,800
6 Bekhet, Yasmin 2013 Malaysia 1996-2010 CO, NO2, SO2, PM10, O3 CO, PM10, Nemerow Index 5,300
7 Shahbaz, Ozturk, Afza, Ali 2013 Turkey 1970-2010 CO2, energy intensity Economic growth,
Long run and short run 4,797
bounds testing approach, the
Granger causality test, and VECM
8 Saboori, Sulaiman 2013 5 ASEAN countries 1971-2009 CO2, energy consumption Singapore, Thailand Indonesia: 657; Malaysia: 116;
Phillippines: 1,215; Singapore: 5,731;
Thailand: 1,752
bounds testing approach, the
Granger causality test, and VECM
9 Burke 2012 105 countries CO2 CO2
3,640-29,726 (2005 prices)
10 Tsuzuki 2009 24-42 developing countries Cross-county, 1990s BOD, TN, TP GDP per capita BOD, TP (Inverted U-shaped curve) TN (U-shaped curve) BOD: 5,054; TP: 11,199
11 Tsuzuki 2008 23 developing countries Cross-county, 1990s BOD, TN, TP PPP-GNI per capita BOD, TP (Inverted U-shaped curve)
BOD: 2,245
; TP: 10,957
12 Tsuzuki 2007, 2009 Catchment of Lakes Shinji
and Nakaumi
1955-1993 COD, TN, TP Nominal gross prefecture
product per capita
COD, TN, TP COD: 13,283; TN: 5,550; TP: 11,609
13 Perman, Stern. 2003 74 countries 31 years SO2 SO2
For the indivisual countries and panel
cointegration tests, out of the sample range
and monotonic emission-income
relationship has been implied.
Unrestricted model: 10,795; Pooled mean
group restricted model: 15,063; Static
fixed effects model: 82,746.
Non-OECD countries: Unrestricted
estimate: 403; Pooled mean group: 28,792;
Fixed effects model: 116,619.
Cointegration analysis
14 Dasgupta, Laplante, Wang, Wheeler 2002 Review Several air and water pollutants Income per capita USD 5,000-8,000
15 Grossman and Krueger 1995 42 counties Cross-county
BOD, COD, NO3-N, T.coli
, F.coli
f GDP per capita
BOD, COD, NO3-N, T.coli
, F.coli
f BOD: 7,623; COD: 7,853; NO3-N:
10,524; T.coli: 3,043; F.coli: 7,955
16 Grossman and Krueger 1991 19-42 countries Cross-county
SO2, smoke (dark matter), SPM
g GDP per capita
SO2, smoke (dark matter), SPM
SO2,and smoke (dark matter) 4,000-5,000;
: 15,000-16,000
a: Data envelopment analysis; b: Autoregressive distributed lag; c: Vector error correction method; d: Re-calculated based on the data of the literature; e: Total coliform; f: Escherichia coli; and g: Suspended particulate matter.


Figure 1. Relationship between economic development and pollutant discharges per capita
(PDC) in the catchments of Lakes Shinji and Nakaumi, Japan, from 1955 to1993 (Tsuzuki,
2007, 2009b)

Table 2. Geographic, demographic and meteorological conditions of the subjected

showed the EKC relationships for BOD and TP (Tsuzuki, 2008, 2009a). There are
differences in socio-economic conditions in the catchments in Japan and Australia
(Table 2).

0.0 0.5 1.0 1.5 2.0 2.5 3.0
Nominal gross prefecture product per capita (Million JPY)


2 (TN)
(g day
(g day
Area Main
Precipitation Average daily
Average daily
km '000 person person km
mm year
Oxley Creek 260.0 70 152 585 Sub-tropical 1,149 25.5 15.7 Archerfield Airport (P:1972-2013,
Norman Creek 29.8 19 90 3,020 Sub-tropical 1,068 26.2 14.3 Brisbane (P:1840-1994, T:1987-1986)
43 55 1,484 25.2 15.8 Sunshine Coast Airport
Moreton region (1971)
1,031 48 Sub-tropical
1,149 25.5 15.7
Brisbane (P:1840-1994, T:1987-1986)
Southeast Queensland 22,420.0
3,131 140 Sub-tropical
1,149 25.5 15.7
Brisbane (P:1840-1994, T:1987-1986)
Brisbane River 13,780.0 14,035 2,240 163 Sub-tropical 1,149 25.5 15.7 Brisbane (P:1840-1994, T:1987-1986)
1,070.0 68 2,102 1,964 1,212 20.5 11.7 Sakai (Osaka)
1,002 20.1 10.0 Nara (Nara)
Lakes Shinji and Nakaumi 1,883.4 153 350 186 Temperate 1,799 19.4 11.1 Matsue (Shimane)
Brisbane City Council Information (2011) Norman Creek vision and concept plan
Brisbane City Council Information (2012) Know your creek, Norman Creek Catchment
Oxley Creek Cathment Association (1999) Oxkley Creek Catchment Management Plan
Interview to Sunshine Coast Council (2013) Personal communication
Australian Bureau of Statistics (2001, 2006 and 2011) Census of Population and Housing
Australian Government Bureau of Meteorology (2014) Climate statistics for Australian locations (, accessed on 17 May 2014)
Brisbane, Queensland Co-ordinator-General's Department (1973) Moreton region: man made environment
Yamato-gawa River Office (2005) Explanation of current conditions of the Yamato-gawa River, Yamato-gawa River Committee materials (in Japanese)
Japanese Meteological Agency (2013) Statistic data of meteorological information (, accessed on 11 Jul 2013) (in Japanese)
Shimane Prefecture (Japan) (2010) The fifth lake water quality consevation plan on Lake Shinji (in Japanese)
Shimane and Tottori Prefectures (Japan) (2010) The fifth lake water quality conservation plan on Lake Nakaumi (in Japanese)
Catchment Climate Monitoring point for precipitation (P)
and temperature (T)
a: Oxley Creek in 1991, estimation was 113,300 in 1996 and 152,181 in 2011. In Noosa Catchment, total number of people in the catchment is almost doubled in the tourism season.
Southeast Queensland on 30 June 2010. Yamato-gawa River basin is for 2010.; b: Moreton region was consisted of Brisbane, Gold Coast, Ipswich and Redcliff cities, and Albert,
Beaudesert, Boonah, Caboolture, Esk, Gatton, Kilcoy, Laidley, Landsborough, Maroochy, Moreton, Pine Rivers and Redland Shires in 1973; c: Not available.
Noosa River 784.0 60
Yamato-gawa River

Population density in Southeast Queensland and the Brisbane River Catchment, 140
and 163 persons km
, are closer to that of the catchments of Lakes Shinji and
Nakaumi, 186 persons km
, than that of the Yamato-gawa River, 1,964 persons km
when compared to the catchments in Japan. Among the 60 countries with the largest
populations in the world, population density is the smallest in Australia, 2.92 persons
, and Japan is the fifth largest, 337 persons km
(Fig. 2). There are several
water environment programs focusing on the rivers and creeks in Australia including
the Healthy Waterways and Southeast Queensland (SEQ) Catchments in Southeast
Queensland (QDERM, 2009; Healthy Waterways, 2012). There are various
measures to reduce pollutant discharges and to improve river water quality in these
countries (Healthy Waterways, 2012; Tsuzuki et al., 2012). Ambient water quality has
been managed with water quality modellings such as the SEQ Receiving Water
Quality Model (QDERM, 2010; Parslow, 2011). It is questionable whether similar
EKC relationships are observed for the relationships of economic development level
and pollutant discharges in these countries.

Figure 2. Population densities of 60 countries with the largest populations in 2012 (Prepared
by the author based on the World Bank, 2014)
In this paper, first, the hard and soft measures to improve the river water
environment in Australia and Japan were qualitatively compared to find the
similarities and differences in these measures. Second, the relationship between
economic development and pollutant discharge in Southeast Queensland was
investigated. Basic trends of pollutant discharge from diffuse sources for TN and TP
were estimated based on the pollutant discharge data in 2004 and predictions for
2026 in the Healthy Waterways report (Cavanagh, 2011). Based on the pollutant
discharge alteration tendencies from diffuse sources, the effect of annual
precipitation was included by developing a precipitation variation coefficient (PVC).
Pollutant discharges from point sources were estimated using the data of the
National Pollutant Inventory (NPI) (Australian Government Department of
Sustainability, Environment, Water, Population and Communities (ADSEWPC),
2013) and the Queensland Government (QDSITIA, 2013).

(person km
Japan Australia

Definitions of pollutant discharge indicators
A water pollutant is sometimes treated at a generated place and the effluent is
discharged into ambient water. The per capita amount of the pollutant generated at
the pollutant source is defined as the pollutant generation per capita (PGC) and that
of pollutant discharged to ambient water is known as the PDC (Tsuzuki et al., 2012;
Tsuzuki, 2014). The PGC usually increases with economic development. On the
contrary, such relationships are often observed that PDCs increase with economic
development at the beginning, and decrease with further economic development
because of the introduction of measures to decrease pollutant discharges.
Comparison of water environment improvement measures including community
involvement programs in Australia and Japan
TN and TP concentrations have been improved in the Lower Brisbane River
Catchment in 19752012 (Tsuzuki, 2013a). For the water quality improvements,
several hard and soft measures have been conducted in these countries (QDERM,
2009; Healthy Waterways, 2012; Tsuzuki et al., 2012). The Social Experiment
Program in the Yamato-gawa River Catchment has been successful in water quality
improvement and has achieved the water quality criteria of BOD concentration in the
river, 5 mg l
of annual average and 75% percentile, while that was once more than
20 mg l
in the early 1970s (Tsuzuki et al., 2012). A qualitative comparison of the
measures to improve river water environment was conducted between Australia and
Relationship between economic development of Australia and pollutant discharge
from the Brisbane River Catchment in 19602010
The chronological relationships between economic development and pollutant
discharges in Southeast Queensland were investigated for TN and TP. Purchase
power parity based gross domestic product (PPP-GDP) in Australia was calculated
from the government statistical data of quarterly GDP data, population data and the
consumer price index (CPI) based in 2009 (Australian Bureau of Statistics (ABS),
2013). Australian dollar (AUD) and Japanese Yen (JPY) were converted to USD or
AUD prices supposing AUD 1 equalled USD 0.93, AUD 1 equalled JPY 94 or USD 1
equalled JPY 101.
Long-term alteration tendencies of pollutant discharges from diffuse sources were
firstly estimated based on the Healthy Waterways report (Cavanagh, 2011). Secondly,
effects of precipitation were included in pollutant discharge estimation by introducing
PVC (Eq. 1) (Tsuzuki, 2013a; 2013b).


a v e i
a v e
a v e j
j i j i
1 , , 2 , ,

where PD
is pollutant discharge of pollutant i in year j with the effects of
precipitation (t year
); PD
is pollutant discharge of pollutant i in year j without the
effects of precipitation (t year
); PRE
is precipitation of year j (mm year
); PRE
yearly average precipitation (mm year
); PD
is yearly average pollutant discharge
(t year
); PVC is PVC (dimensionless).
The estimation results were compared with the pollutant discharge data in the
existing literature (Queensland Co-ordinator-General's Department, 1973; Eyre and
McKee, 1999; Stevens et al., 2005; Abal et al., 2005; Maxwell et al., 2007; SEQHWP,
2007; Rogers et al., 2013) and pollutant discharge estimations based on the spatial
data and pollutant discharge per land area in Southeast Queensland (Abal et al.,
2005; Queensland Government, 2013). Areas for the pollutant discharge estimations
in the existing literature were the Moreton Bay Catchment before 2000 and
Southeast Queensland in 20002010.
Pollutant discharges from point sources were estimated based on the National
Pollutant Inventory (NPI) (ADSEWPC, 2013) and pollutant discharge data obtained
from the Queensland Government (QDSITIA, 2013). Most pollutant discharge data
of the NPI and the Queensland Government are only after 1999. Therefore, pollutant
discharge estimations from point sources before 1999 were conducted by the
following two methods. First, point source pollutant discharges before 1999 were
assumed to be constant. Second, those were assumed to be proportional to
population for pollutant discharges from sewage treatment plants (STPs), and
proportional to PPP-GDP for those from industries.
Relationship between economic development of Japan and municipal wastewater
pollutant discharge from the Yamato-gawa River Catchment, Japan, in 19552010
The relationship between PPP-GDP per capita of Japan and municipal wastewater
pollutant discharge from the Yamato-gawa River Catchment, Japan, in 19552010
was recalculated based on the existing literature applying the government statistical
data of GDP and deflator, population and BOD discharge per capita from municipal
wastewater (Tsuzuki and Yoneda, 2012; Cabinet Office of Japan, 2014; Ministry of
Internal Affairs and Communications of Japan, 2014). Municipal wastewater has
contributed 80% of BOD discharge in the catchment. Therefore, chronological
estimations of municipal wastewater PDC are considered to explain most of the
pollutant discharge alterations in the catchment.

Comparison of water environment improvement measures in Australia and Japan
Water environment improvement measures in Australia and Japan were compared
as shown in Table 3. There are similarities and differences in both hard and soft
measures between these countries. Hard measures have similarities such as
centralised and on-site wastewater treatment and prevention of sedimentation loss in
forest and agriculture lands. Rice fields are typical of the Japanese agricultural
sector and a range of measures to decrease pollutant discharges have been
developed (Takeda and Fukushima, 2006; Somura et al., 2012; Chono et al., 2012).
In the rivers and canals, installation of logs, flood infiltration systems, stormwater
harvesting project such as the South Bank Stormwater Harvesting and Recycling
Centre (SHARC) project and bush care activities are typical measures in Australia
(Bunn et al., 1999; Mitchell, 2006; Hamlyn-Harris and Pickering, 2008; Sarker et al.,
2008; Strang, 2008; Arthington, 2012; Healthy Waterways, 2012) while river water
purification facilities are typical in Japan (Tsuzuki et al., 2012). The soft measures in
households have been typical ones in Japan to improve river water quality by
community involvement while disseminations of information about environment-
friendly lifestyles have also been conducted in Australia.
Table 3. A comparison of Australian and Japanese measures to improve river water
Category Australia Japan

Wastewater Centralised wastewater treatment
On-site wastewater treatment
Centralised wastewater
On-site wastewater treatment
Forest Prevention of sedimentation loss Prevention of sedimentation loss
Agriculture Decrease of fertiliser usage
Prevention of sedimentation loss
Decrease of fertiliser usage
Prevention of sedimentation loss
Water management in rice fields
River/canal Installation of logs in the river
Bush care activity
Stormwater harvesting project
Flood infiltration system
River water purification facility
Soft measure
Lifestyles in
Dissemination of environment-
friendly lifestyle
Social Experiment Program (Soft
measures in households)
Dissemination of environment-
friendly lifestyle
Cleaning up activity
White column: Similar measures; and Grey column: Different measures.


Relationship between PPP-GDP per capita in Australia and PDC in the Brisbane
River Catchment in 19602010

Chronological alterations of PPP-GDP per capita were calculated based on the
Australian and Japanese government statistics (Fig. 3) (ABS, 2013; Cabinet Office of
Japan, 2013).

Figure 3. PPP-GDP in Australia and Japan (2009 price) (Prepared by the author based on
ABS, 2013; and Cabinet Office of Japan, 2013)
For the pollutant discharge estimation results, only the second results are shown in
Fig. 4, where pollutant discharges from point sources before 1999 were assumed to
be proportional to population for pollutant discharges from STP and PPP-GDP for
those from industries, respectively. Explanations of the first results with the constant
assumption are described in the texts. Pollutant discharges from point sources have
been decreased substantially in the 2000s. Pollutant discharges from diffuse sources
with PVC were estimated to fluctuate during the investigation term. The ratios of
discharge amounts from point sources to those from diffuse sources were 40.6
44.8% in 19602010 and 26.137.9% in 19992010 for TN, and 23.326.6% in
19602010 and 25.336.5% in 19992010 for TP. Therefore, pollutant discharges
from both diffuse and point sources were considered to contribute significantly in the
catchment for many years. However, the ratios decreased to 5.07.2% for TN and
8.011.5% for TP in 2010. These tendencies were similar in the results with the
constant assumption while pollutant discharges from point sources were constant in
19601999. The pollutant discharge estimation of TP was relatively larger than the
major range of the existing research data, however, the estimation results were
considered to be comparable with the existing research and pollutant discharge
1950 1960 1970 1980 1990 2000 2010 2020




(AUD '000 / year)

estimations from the spatial data (Fig. 5). The comparison results showed large
effects of precipitation on the pollutant discharges from the catchment, which were
inconsistent with the common understanding in Southeast Queensland (Eyre, 1997;
Bunn etal., 1999; Dennison and Abal, 1999; SEQHWP, 2007; QDERM, 2009, 2010;
Cavanagh, 2011; Rogers, 2013).

Figure 4. Chronological pollutant discharges of TN and TP in the Brisbane River Catchment
(Pollutant discharge data of point sources were obtained from the Australian Government
(ADSEWPC, 2013) and the Queensland Government (QDSITIA, 2013))

1960 1970 1980 1990 2000 2010 2020

Diffuse without
Diffuse with
Total without
Total with PVC
('000 t / year)
(a) TN
1960 1970 1980 1990 2000 2010 2020

Diffuse without
Diffuse with
Total without
Total with PVC
('000 t / year)
(b) TP


Figure 5. Comparisons of the pollutant discharge estimations of this research,
existing data, and those based on the Queensland Government spatial data

The relationship between PPP-GDP per capita and pollutant discharges in the
Brisbane River Catchment were expressed as second-order equations, especially
when the effects of precipitation were not included (Fig. 6, Table 4). When the effects
of precipitation were included, the correlation was less than the relationship without
the precipitation effects.

1960 1970 1980 1990 2000 2010 2020 2030 2040

Total without PVC
Total with PVC
Diffuse without PVC
Diffuse with PVC
TN (Existing data)
('000 t / year)
(a) TN
Existing data were from
Rogers et al. (2013);
Cavanagh (2011);
SEQHWP (2007); Maxwell
et al. (2007); Stevens et al.
(2005); Abal et al. (2005);
Eyre and McKee (1999)
and Queensland Co-
Department (1973), and
based on the Queensland
GIS (QGIS) (2013).
1960 1970 1980 1990 2000 2010 2020 2030 2040

Total without PVC
Total with PVC
Diffuse without PVC
Diffuse with PVC
TP (Existing data)
('000 t / year)
(b) TP
Existing data were from
Rogers et al. (2013);
Cavanagh (2011);
SEQHWP (2007); Maxwell
et al. (2007); Stevens et al.
(2005); Abal et al. (2005);
Eyre and McKee (1999)
and Queensland Co-
Department (1973), and
based on the Queensland
GIS (QGIS) (2013).


Figure 6. Relationship between GDP per capita in Australia and pollutant discharge
in the Brisbane River Catchment (Pollutant discharge data of point sources were
obtained from the Australian Government (ADSEWPC, 2013) and the Queensland
Government (QDSITIA, 2013)

0 1 2 3 4 5 6 7


GDP per capita (AUD 0'000 person
Total without
Total with
without PVC)
with PVC)
('000 t year
(a) TN
0 1 2 3 4 5 6 7


GDP per capita (AUD 0'000 person
Total without
Total with
without PVC)
with PVC)
('000 t year
(b) TP

Table 4. Comparison of the coefficient, constant, R-squared and inflection points of the regression analyses of this research and
some existing literature on water pollutant discharges

Area Parameter Conditions Third-order
GDP at the peak
PD at the peak
USD person
g person
Brisbane River TN Without PVC AUD 10,000
-0.4240 3.4631 -0.5948 0.8187 43,912 8.6
This research
With PVC AUD 10,000
-0.3994 2.9598 0.8923 0.1332 39,842 6.7
This research
TP Without PVC AUD 10,000
-0.0671 0.6824 1.1439 0.8619 54,677 2.1
This research
With PVC AUD 10,000
-0.0546 0.4270 1.8984 0.0105 42,046 1.0
This research
Coastal area in the world BOD PPP-GNI per capita USD 1,000
-0.1996 0.8882 19.0300 0.0721 22,249 20.0
Tsuzuki (2008)
BOD PPP-GNI per capita USD
Tsuzuki (2008)
BOD PPP-GNI per capita USD
2,100 2,600
Tsuzuki (2008)
TP GDP per capita USD 1,000
-0.0128 0.2805 0.3597 0.2184 10,957 1.9
Tsuzuki (2008)
TP PPP-GNI per capita USD
Tsuzuki (2008)
TP PPP-GNI per capita USD
13,000 14,000
Tsuzuki (2008)
Developing countries BOD GDP per capita USD
-0.0900 0.9098 22.2220 0.0443 5,054 24.5 Tsuzuki (2009a)
TN GDP per capita USD
0.0194 -0.7329 7.6962 0.2932 18,889 0.8 Tsuzuki (2009a)
TP GDP per capita USD
-0.0181 0.4054 0.3726 0.2840 11,199 2.6 Tsuzuki (2009a)
Lakes Shinji and Nakaumi, Japan
GDP per capita JPY million
-3.0750 8.1690 15.7190 0.8430 13,283 21
Tsuzuki (2007, 2009b)
TN GDP per capita JPY million
-0.9000 0.9990 9.0670 0.4080 5,550 9.3
Tsuzuki (2007, 2009b)
TP GDP per capita JPY million
-0.2020 0.4690 0.7160 0.3550 11,609 1.0
Tsuzuki (2007, 2009b)
42 countries DO GDP per capita USD 1,000 0.004 -0.127 1.33
Grossman and Krueger (1995)
BOD GDP per capita USD 1,000 -0.022 0.335 1.41
Grossman and Krueger (1995)
COD GDP per capita USD 1,000 0.015 0.498 -19.66
Grossman and Krueger (1995)
NO3-N GDP per capita USD 1,000 -0.007 0.188 -1.16
Grossman and Krueger (1995)
T.coli GDP per capita USD 1,000 -0.016 0.473 -3.71
Grossman and Krueger (1995)
F.coli GDP per capita USD 1,000 -0.0038 0.110 -0.85
Grossman and Krueger (1995)
Unit of explanatory
a: PPP-GDP per capita at the peak of the second-order function; b: Pollutant discharge at the peak of the second-order function; c: Re-calculated based on the literature; d: Chemical oxygen demand; e: Not available; and f: P-value (income


Relationship between PPP-GDP per capita in Japan and PDC in the Yamato-gawa
River Catchment in 19552010
The relationship between GDP per capita and BOD discharge per capita from
municipal wastewater in the Yamato-gawa River Catchment in 19552010 was
calculated based on the existing literature (Fig. 7) (Tsuzuki, 2007, 2009b). The
relationship was found to show the EKC inverted U-shaped curve. The proximate
square-equation lines of the inverted U-shaped curves are usually bilaterally
symmetrical because of the mathematical method of regression analysis, however,
the tendencies of the actual data might be different in the samples. Symmetry of the
inverted U-shaped curves of the EKC are sometimes observed and suggested as
smaller curvatures in the right half of decreasing curves rather than the left half of the
increasing curves (Dasgupta, 2002; Burke, 2012; Liao and Cao, 2013). S-shaped
and N-shaped curves which are approximated with third-order equations have also
been hypothesised (Du et al., 2014). The results of the Yamato-gawa River
Catchment exhibited a larger curvature in the right half than the left half of the
inverted U-shaped curve. The environmental burden at the right end or in the 2000s
was smaller than that at the right end in the 1950s. This curve was considered to be
exceptional comparing to the existing concepts and research results, which showed
the effectiveness of the hard and soft measures in the catchment.

Figure 7. Relationship between GDP per capita of Japan and BOD discharge per
capita in the Yamato-gawa River Catchment in 19552010 (Recalculated from
Tsuzuki, 2007, 2009b)

y = -0.0641x
+ 3.1369x + 5.117
R = 0.7756
0 5 10 15 20 25 30 35 40 45 50





GDP per capita ('000 AUD person
x: GDP per capita ('000 AUD person
y: BOD dischage per capita (g person


The TN and TP concentrations in the Lower Brisbane River Catchment have been
gradually decreased in 19752010 (Tsuzuki, 2013a). Therefore, pollutant discharges
from diffuse and point sources were not necessarily considered to affect
proportionally these water qualities. The relationship between the pollutant
discharges and water quality concentrations are only briefly discussed in this paper.
For TN and TP discharges from the Brisbane River Catchment, point sources were
more influential in regards to socio-economic development than diffuse sources in
the catchment during the investigation period when gradual decreases
(improvements) of TN and TP concentrations in the Lower Brisbane River Catchment
was observed in this decade (Fig. 4) (Tsuzuki, 2013a).
Because of the relatively large precipitation in recent years, total and diffuse pollutant
discharges for TN and TP in 20082010 were larger than those in 20012007 (Figs.
4 and 5). During the decade, although TN and TP pollutant discharges from point
sources decreased, total and diffuse pollutant discharges with PVC increased in the
late 2000s. The tendencies of pollutant discharges and water quality were
considered to be reasonable when the spatial distributions of pollutant sources are
taking into account. The diffuse sources spread across all the catchment including
the upper and middle sub-catchments, and most of the point sources are placed in
the Lower Brisbane River Catchment where long-term water quality decreases
(improvements) for TN and TP were observed (Tsuzuki, 2013a).
The relationships between economic development and pollutant discharges were
found to be inverted U-shaped curves especially without PVC (Fig. 6, Table 4).
Correlation coefficients were smaller for the PDCs with PVC. Socio-economic effects
are considered to be related to both point and diffuse sources. For the pollutant
discharges and water quality tendencies in some catchments around the Brisbane
River, in the Richmond River Catchment, northern New South Wales (NSW),
phosphate concentration has been found to be in a similar level besides a 2.5 fold
phosphorus discharge increase in 50 years (Eyre, 1997). In the Moreton Bay
Catchment, where the Brisbane River Catchment is included, fertiliser applications
have been increased while the land areas of sown pasture and cropland have
decreased after 1960 (Neil, 1998; Dennison and Abal, 1999). Further be more
precise and longer-term investigations of pollutant discharges including the effects of
the flood infiltration systems and stormwater harvesting projects.
Yandle et al. (2004) have summarised economic indicators at the inflection or turning
points of the EKC. There have been many research results on air pollutants from
, NO
to CO
and GHG since the 1990s. Some existing results on the inflection
points for water quality parameters were summarised as well as recalculated results
based on the existing research to compare with the results in this paper (Tables 1
and 4). The inflection points for pollutant discharges without the precipitation effects
occurred around the year 1999. These were affected by pollutant discharge


tendencies from point sources (Figs. 4 and 6). PPP-GDP per capita at the inflection
points were AUD 37,05350,849 (USD 39,84254,677) person
, which were
larger than those in the existing literature, USD 2,10022,249 person
4) (Grossman and Krueger, 1995; Tsuzuki, 2007, 2008, 2009a, 2009b). PPP-GDPs
per capita at the inflection points in this research were larger than those in the
existing research including those on other environmental parameters such as CO

and GHG emissions (Table 1). In the Brisbane River Catchment, there might be
other inflection points with the smaller PPP-GDP per capita for the investigation
period of 19602010, which should correspond to the traditional water quality
improvement measures and regulations. Therefore, the relationship curves might be
four- or two-dimensional depend on the chronological data of pollutant discharges in
further research. The inflection points found in this research might also be caused by
the estimation methods due to the data availability and should be investigated further
in detail.
TN and TP discharge amounts estimated in this research for the Brisbane River
Catchment, 6.78.6 g-N person
and 1.02.1 g-P person
, were
considered to be comparable with those in the existing research of the Japanese
catchments and coastal areas of developing countries, 0.89.3 g-N person

and 1.02.6 g-P person
, while the results of the Japanese catchments have
been of only municipal wastewater pollutant discharges (Tsuzuki, 2007, 2009b). The
hard and soft measures in the Yamato-gawa River were also reassured to be
effective measures for pollutant discharge reduction (Fig. 7).
Agriculture and mining are the important primary industries in Queensland, Australia
(Battellino, 2010; Eady et al., 2013; Porter et al., 2013; Patterson et al., 2013;
Ivanova, 2014;). These industries have potentials to affect the river water
environment because of their pollutant discharges. In this paper, specific
quantifications and investigations of these pollutant discharges were not conducted,
and some effects of agriculture including fertilisers were considered to be included in
the pollutant discharge from diffuse sources (Queensland Co-ordinator-General's
Department, 1973; Eyre and McKee, 1999; Stevens et al., 2005; Abal et al., 2005;
Olley, 2006; Maxwell et al., 2007; SEQHWP, 2007; Rogers et al., 2013). More
specific investigations of pollutant discharges including the effects of these industries
would be considered in further research.
The relationships between economic development and pollutant discharges have
been represented not only by the inverted U-shaped curves but also by S-curves and
N-curves (Table 1) (Chen and Wang, 2013; Wang and Wei, in press). The results of
the S-curves and N-curves have suggested environment improvement should not
occur automatically with the certain level of economic development. Water quality in
the Brisbane River has been considered to be worse than that of more than 50 years
ago (Dennison and Abal, 1999). Decreasing pollutant discharges is considered to be
necessary for water quality improvement and conservations of the precise water


environment. Desirable combinations of technologies, regulations and governances
are considered to be effective for pollutant discharge management. The quantitative
evaluation on the effects of these policies and measures would be possible by such
methods as the EKC and benefit-cost analyses.
Based on the existing literature and data including government statistics, the
relationships between economic development and pollutant discharges in Southeast
Queensland in 19602012 were investigated. Inverted U-shaped curves of the EKC
were found for the relationships in the Brisbane River Catchment. The inflection
points were found around the year 1999. Their PPP-GDPs per capita at the inflection
points were found to be larger and PDCs were found to be in the similar ranges
comparing to the existing literature. The reasons for the larger PPP-GDPs per capita
were considered to be that the inflection points should correspond to the measures
to reduce pollutant discharges from the point sources in the 2000s in the Brisbane
River Catchment. The hard and soft measures in the Yamato-gawa River Catchment
were reassured to be effective for pollutant discharge reduction. Further detailed
investigations would enhance understanding of these measures and water quality in
Australia and Japan.
The author acknowledges and appreciates academics, staffs and students of The
University of Queensland for many kinds of support for the research, especially Prof.
David Lockington. The author thanks the Queensland Government Department of
Science, Information Technology, Innovation and Arts (DSITIA) for providing the
pollutant discharge data and comments to the former version of the manuscript.
Comments and suggestions from the reviewer and editor have enhanced the quality
of the paper. The author thanks Julie Martyn for English proof reading. Any errors, if
any, would be solely the responsibility of the author.
Yoshiaki Tsuzuki is a PhD student at The University of Queensland and a
collaborative researcher at Shimane University. His background is environmental
engineering, and is interested in engineering and natural science aspects and socio-
economic aspects of water environment, ecological economics, water and sanitation,
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Part II.
Environment and Society


Greenspace and life satisfaction: The moderating role of fear of
crime in the neighbourhood
Christopher L. Ambrey
, Christopher M. Fleming
* and Matthew Manning

Department of Accounting, Finance and Economics, Nathan Campus, Griffith
University, 170 Kessels Road, Nathan, Queensland 4111, Australia.
This paper uses data on self-reported life satisfaction, fear of crime and access
to greenspace to explore the relationship between the (potential) welfare
benefits of greenspace and fear of crime in New Zealand neighbourhoods. In
line with existing evidence, results suggest that improved access to
greenspaces is associated with higher levels of life satisfaction. The strength of
this association, however, is strongly dependent on fear of crime. Specifically,
when residents report that they feel unsafe or very unsafe walking alone in
their neighbourhood, the life satisfaction benefits of access to greenspace are
not marginally reduced, rather, they disappear entirely. From a policy
perspective, these results are particularly important, suggesting that any
benefits derived from sourcing, provisioning and managing greenspace are
dependent upon managing actual and perceived levels of crime.
Fear of Crime; Greenspace; Life Satisfaction; New Zealand General Social
Survey (NZGSS).
Evidence suggests that greenspace promotes health and well-being. Identified
channels through which this may occur include restorative psychological benefits (cf.
Kaplan, 1995), reduced stress (cf. Ulrich et al., 1991), greater physical activity (cf.
Jones et al., 2009; Sugiyama et al., 2010; Sugiyama et al., 2008), increased
longevity (cf. Takano et al., 2002), increased social interaction (cf. Francis et al.,
2012), and greater life satisfaction or happiness (cf. Ambrey and Fleming, 2013;
MacKerron and Mourato, 2013). Reviews of the literature are provided by Bell et al.
(2008), Croucher et al. (2007a), Croucher et al. (2007b), Sunderland (2012) and, in
the New Zealand context, Blaschke (2013).
Evidence however, also points to greenspace being associated with fear of crime.
For example, Schipperijn (2010) cites evidence that urban greenspaces are seen as
dangerous places (cf. Jorgensen et al., 2007; Ward Thompson et al., 2004) and
people might fear going there (cf. Jorgensen and Anthopoulou, 2007; Van den Berg
and Ter Heijne, 2005). Aspects that underpin the positive experience of greenspace
(e.g. enclosure, seclusion and other-worldliness) are also the foundation of the fear
and unease that people experience when coming into contact with this space (e.g.
fear of becoming the victim of physical or sexual assault, robbery or bullying and
intimidation from groups of young people). These fears are compounded by the idea
that, if anything were to happen, no-one would come to their aid (Burgess, 1995).
It is not surprising then to find that residents report fear of crime to be a barrier to
using greenspace (cf. McCormack et al., 2010), report higher life satisfaction in safer
neighbourhood greenspace (cf. Sugiyama et al., 2009) and that residents in
neighbourhoods with more greenspace who are more fearful of crime also
experience greater psychological distress (cf. Chong et al., 2013). The literature,
however, does not clearly identify the magnitude of any reduction in the well-being
benefits of greenspace that can be attributed to the fear of crime. This is the purpose
of our study.
Specifically, in view of the existing literature and in the context of New Zealand, this
paper aims to test the following hypotheses:
H1: Easy access to greenspace is positively associated with a residents self-
reported life satisfaction.
H2: A residents satisfaction with the quality of greenspace in their
neighbourhood is positively associated with their self-reported life satisfaction.
H3: Fear of crime in a residents neighbourhood is negatively associated with
that residents self-reported life satisfaction. And
H4: Fear of crime in a residents neighbourhood reduces the positive
association between access to greenspace and self-reported life satisfaction.
The paper proceeds as follows. Section 2 describes method and data, results are
presented in Section 3. Section 4 provides some concluding remarks.
Method and data
A micro-econometric life satisfaction model is estimated, where life satisfaction is a
function of socio-economic and demographic characteristics, access to greenspace,
satisfaction with the quality of greenspace, fear of crime in the neighbourhood and
other covariates. The model takes the form of an indirect life satisfaction function for
resident r, in location k, at time t, as follows:


is the self-reported life satisfaction of resident r, in location k, at time t;

is equivalised household income;

is a vector of socio-economic and

demographic characteristics, neighbourhood (dis)amenities and other controls;

denotes access to greenspace in a residents neighbourhood;

satisfaction with quality of greenspace in a residents neighbourhood,

fear of crime in the neighbourhood,


are location and time fixed effects,


is the error term.

The model is then extended to examine the interaction between access to
greenspace (

) and fear of crime (

) (Equation 2). Similar to estimation

strategies employed elsewhere (cf. Brereton et al., 2008), an ordered logit model is
estimated by maximum likelihood estimation.

As shown by Ferreira and Moro (2010) it is possible to estimate the implicit
willingness-to-pay (denoted WTP) for a marginal change in an amenity or disamenity
by taking the partial derivative of life satisfaction with respect to (in our case) access
to greenspace in the neighbourhood and the partial derivative of life satisfaction with
respect to household income, as follows:

Data is obtained from the 2008 and 2010 waves of the New Zealand General Social
Survey (NZGSS). The NZGSS provides information on the well-being of New
Zealanders. The target population for the NZGSS is the usually resident New
Zealand population aged 15 years and over in private dwellings in the North Island,
South Island, or Waiheke Island. Both household and personal questionnaires are
used to collect data, with one individual in the household randomly selected to
answer the personal questionnaire. The NZGSS uses a three-stage sample selection
Of the 17,271 respondents who answered the personal questionnaire
(8,550 in 2008 and 8,721 in 2010), we subset the data to 15,118 respondents who
answered all required questions. 46.8 per cent of the sample are male, and 15.1
per cent are of Maori or Pacific Island descent. In regards to education, 18.6 per cent
have a Bachelors degree or higher, while 57.6 per cent have either a certificate or

Fear of crime encapsulates a cognitive aspect (the perceived risk of victimisation) and an affection
component (the emotional response to crime or symbols associated with crime). See: Lorenc, T.,
Clayton, S., Neary, D., Whitehead, M., Petticrew, M., Thomson, H., Cummins, S., Sowden, A.,
Renton, A., 2012. Crime, fear of crime, environment, and mental health and wellbeing: Mapping
review of theories and causal pathways. Health & Place 18, 757-765.
For further details see:
diploma. In regards to labour force participation, 14.1 per cent are in part-time work,
3.3 per cent are unemployed and 33.4 per cent are classified as non-participants.
The dependent life satisfaction variable is obtained from residents responses to the
question: How do you feel about your life as a whole right now? This an ordinal
variable, discretely categorised as; very satisfied; satisfied; no feeling either
way; dissatisfied; very dissatisfied. Figure 1 below provides a frequency
distribution of the life satisfaction variable.

Figure 1: Frequency distribution of life satisfaction (1-5)
The access to greenspace measure is derived from response to the question: How
many of the native bush, forest, nature reserve or open green spaces in your local
area can you easily get to? To this question, the resident may respond: all of them;
most of them; some of them; only a few of them; none of them; never want or
need to go to any of them; dont know; or refused. The satisfaction with
greenspace measure is derived from response to the question: Overall, how do you
feel about the state of the native bush, forests, nature reserves, and open green
spaces that youve been to? To this question, the resident may respond: very
satisfied; satisfied; no feeling either way; dissatisfied; very dissatisfied;
havent been to any of them; dont know; or refused.
Fear of crime in a residents neighbourhood is measured using residents responses
to the questions: How safe do you feel walking alone at night in your
neighbourhood? and How safe do you feel walking alone during the day in your
1 2 3 4 5
Life satisfaction (1-5)
neighbourhood? To both questions the resident may respond: very safe; safe;
unsafe; very unsafe; not applicable; dont know or refused. Appendix A
provides a description of all variables employed.
In order to test Hypotheses 1-3, we estimate Equation 1. Results are reported in
Appendix B. In regards to socio-economic and demographic characteristics, results
largely support the existing literature and a priori expectations. That is, life
satisfaction is U-shaped in age, reaching a minimum when a resident is in their
forties and fifties. Males are found to be less satisfied than women. Lone parents are
found to have lower levels of life satisfaction, even after controlling for having
children in the household, which itself has an adverse impact on a residents life
satisfaction. Having a partner is associated with higher levels of life satisfaction as is
a higher physical health status score. With regards to education, those with a
diploma, Bachelors degree or higher qualification are found to be more satisfied with
their lives. Unemployment, even after controlling for income (which itself has a
positive effect), appears to be quite detrimental to a residents life satisfaction. Being
a non-participant in the labour force (including retirees, those performing home
duties and non-working students) is associated with higher levels of life satisfaction.
Not owning your own home and being dissatisfied with your amount of free time are
both associated with lower levels of life satisfaction.
In Appendix B, the marginal effect
for the access all greenspace variable is
0.0280, statistically significant at the 1 per cent level. Thus, we do not reject the
hypothesis that ease of access to greenspace is positively associated with a
residents self-reported life satisfaction (Hypothesis 1). Similarly, the satisfied with
greenspace variable is positive and statistically significant at the 1 per cent level,
with a marginal effect of 0.0382. We, therefore, do not reject the hypothesis that
satisfaction with the quality of greenspace in a residents neighbourhood is positively
associated with that residents self-reported life satisfaction (Hypothesis 2). The fear
of crime variable is negative and statistically significant at the 1 per cent level, with a
marginal effect of -0.0186. Thus, we do not reject the hypothesis that fear of crime in
a residents neighbourhood is negatively associated with a residents self-reported
life satisfaction (Hypothesis 3).
In order to test Hypothesis 4, we estimate Equation 2. The marginal effect of the
interaction term between access all greenspace and fear of crime is -0.0329
(standard error of 0.0139), statistically significant at the 5 per cent level. This
suggests that residents who fear crime derive no life satisfaction benefit from access
to greenspace in their neighbourhood; in fact, they are perhaps slightly worse off for
having access to greenspace. This effect is depicted in the right hand column of

In all cases the marginal effect is the change in the probability of a respondent reporting to be very
satisfied with their life for a one unit change in the explanatory variable.
Figure 2. In contrast, the left hand column of Figure 2 shows that residents who do
not fear crime, are approximately 6.17 per cent more likely to report being very
satisfied with their lives if they are easily able to access greenspace.

Figure 2: Marginal effects for access all greenspace interacted with fear of crime

Using Equation 3 and the marginal effects estimates from Table 2, we are able to
monetise the reported effects of greenspace on life satisfaction. This exercise yields
an implicit willingness-to-pay for easy access to all greenspaces (as compared to not
having easy access) of approximately $36,000.

This paper explores preferences for greenspace in New Zealand and the extent to
which these preferences depend on fear of crime in the neighbourhood. The life
satisfaction approach is used to capture the well-being benefits associated with
greenspace. A key finding is that residents with easy access to all native bush,
forest, nature reserve or open greenspace in their neighbourhood report higher
levels of life satisfaction. This is equivalent to an implicit willingness-to-pay of
$36,000 in terms of annual household income. While not directly comparable, this
figure is substantially higher than Veselys (2007) contingent valuation finding that
New Zealand households would be willing-to-pay $184 per annum to avoid a 20
per cent reduction in a residents neighbourhood tree estate. This considerable

All implicit willingness-to-pay valuations are in terms of annual equivalised household income.
All figures are in NZD. As at 8 December 2013, 1 NZD = 0.83 USD / 0.60 EUR / 0.91 AUD.


No fear of crime Fear of crime
monetary difference may, in part, be explained by the size of the life satisfaction
benefits associated with greenspace. Alternatively, the difference may be explained
by two possible sources of bias: (1) a bias in the marginal effect of income owing to
an endogenous relationship between income and life satisfaction; and (2) the fact
that residents with strong preferences for greenspace may self-select into
neighbourhoods with easy access to greenspace.
The finding that easy access to greenspace enhances a residents self-reported life
satisfaction, however, is strongly dependent on fear of crime in the neighbourhood. If
residents fear crime, the associated positive life satisfaction effects are completely
forgone. In contrast, if residents do not fear crime, the positive life satisfaction effects
are enhanced. Fear of crime is thus quite destructive to a residents appreciation of
The obvious explanation for this result is that fear of crime reduces residents use of
greenspace, thereby reducing any life satisfaction benefits associated with the use of
such spaces. This explanation is supported by the findings of a number of studies
(cf. Foster et al., 2012; Seaman et al., 2010), which cite fear of crime as a barrier to
the use of greenspace and to physical activity in a residents neighbourhood more
From a policy perspective, the design and maintenance of greenspace are likely to
be important factors in determining fear of crime and, therefore, the well-being
effects of that space. For example, poorly designed greenspace may promote crime
and fear of crime by offering concealment or refuge, while better designed
greenspace (e.g. with greater visibility) may engender lower levels of fear of crime
(Gatersleben and Andrews, 2013; Kuo and Sullivan, 2001). As explained by Kuo et
al. (1998), in line with Wilson and Kellings (1982) broken windows thesis, the
presence of well-maintained greenspace may reduce the fear of crime by sending a
signal to residents and to potential offenders that this is a cared-for place with
civilised standards of behaviour.
The findings of our investigation highlight the need to address fear of crime in the
neighbourhood in order to realise the full benefits of policies directed at promoting
the use of greenspace. In a practical sense, in addition to the design and
maintenance of greenspace, other options that may mitigate the fear of crime
include: increasing informal surveillance in greenspace (Kuo and Sullivan, 2001);
correcting (mis)perceptions of crime (the cognitive dimension of fear of crime)
through reporting (Weatherburn and Indermaur, 2004); and strengthening the feeling
of neighbourhood cohesion (Renaur, 2007).
We thank Griffith University for the Griffith University Postgraduate Research
Scholarship and the Griffith Business School for the Griffith Business School Top-up
Scholarship; funding that was instrumental in facilitating this research. This research
would not have been possible without data provided by Statistics New Zealand. We
thank participants at the 2013 Australia New Zealand Society for Ecological
Economics Conference for instructive comments. All errors and omissions remain
our own.
Christopher Ambrey is a PhD candidate and a Research Associate at Griffith
Universitys Social and Economic Research Program (SERP). Christophers
research interests include; welfare economics, the economics of happiness, the
history of economic thought, ecological economics, non-market valuation,
environmental economics, natural resource economics, the economics of social
issues, the economics of crime, and the economics of war.
Christopher Fleming is a Director of Griffith Universitys Social and Economic
Research Program (SERP), a Senior Lecturer in the Department of Accounting,
Finance and Economics, and a Senior Associate of MainStream Economics and
Policy. An applied micro-economist with teaching, consulting and public policy
experience, Christophers research and consulting interests include, social and
economic project/program evaluation, natural resource and environmental
economics, the economic determinants of subjective wellbeing, the economics of
crime, the sustainable management of natural resources and the economics of
Mathew Manning is a Director of Griffith Universitys Social and Economic Research
Program (SERP), and Fellow of the Centre for Aboriginal Economic Policy Research,
Australian National University. Matthew employs econometric and economic
modelling techniques to measure the impact of social and crime prevention
programs and policies. Matthew employs a range of techniques used in operations
research to provide policy advice to government agencies. Matthew has published in
the areas of developmental and situational crime prevention, the economic
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Appendix A: Model variables
Variable name Definition Mean
Dependent variable
Life satisfaction Residents self-reported life satisfaction
where 1 is very dissatisfied and 5 is very

Demographic characteristics
Age (15-19) Resident is between 15 and 19 years of age 5.6%
Age (20-29) Resident is between 20 and 29 years of age 12.2%
Age (40-49) Resident is between 40 and 49 years of age 19.3%
Age (50-59) Resident is between 50 and 59 years of age 16.2%
Age (60 or
Resident is 60 years of age or greater
Male Resident is male 46.8%
Mori Residents ethnicity is Mori 11.3%
Pacific Residents ethnicity is Pacific Islander 3.8%
Asian Residents ethnicity is Asian 6.4%
Have a child Resident has at least one dependent child or
adult child and possibly others of an
unknown dependency status
Lone parent Resident is one parent with at least one
dependent child or adult child and possibly
others of an unknown dependency status
Partnered Residents social marital status is partnered 56.0%

Physical health Residents physical health status score (on a
scale of 0 to 100) a derived variable elicited
from the SF-12.

Certificate Residents highest level of educational
attainment is a certificate (includes trade
certificates and secondary school
Diploma Residents highest level of educational
attainment is a diploma (includes nursing and
teaching diplomas and advanced trade
degree or higher
Residents highest level of educational
attainment is a Bachelors degree or higher
Unemployed Resident is unemployed 3.3%
Part-time Resident works part-time 14.1%
Non-participant Resident is not in the labour force 32.4%
income (ln)
Natural log of residents annual equivalised
household income.

Do not own
Resident does not own home 45.0%
Dissatisfied with
free time
Resident is dissatisfied with their free time 42.3%
Civic life and social connectedness
Help in a crisis Resident is able to get support in time of
crisis and small favours available
Right amount of
family contact
Resident has about the right amount of
contact with their family
Not isolated Resident feels isolated from others some 66.2%

from others none of the time
Voted in
Resident voted in the last general election 79.3%
Did voluntary
Resident did voluntary work for a group or
Feel that they
belong to NZ
Resident feels very strongly or strongly that
they belong to New Zealand
Can express
their identity
Resident feels they very easily or easily
express their identity
Crime and fear of crime
Experienced a
violent crime
Resident had a violent crime committed
against them in the last 12 months
Experienced a
Resident had a non-violent crime committed
against them in the last 12 months
Fear of crime Resident reported feeling very unsafe or
unsafe to walk alone in their neighbourhood
Greenspace access and quality
Access all
Resident can access easily all; native bush;
forest; nature reserve or open green spaces
in the neighbourhood
Satisfied with
Resident is very satisfied or satisfied with the
state of the; native bush; forest; nature
reserve or open green spaces the
respondent has been to
Other neighbourhood characteristics
The New Zealand deprivation index 2006 for
the residents area. The ordinal variable
ranges from 1 to 10, where 1 represents
least deprived areas and 10 most deprived

Too far from
Resident feels that a major problem with their
neighbourhood is that they live too far from
Too far from
other amenities
Resident feels that a major problem with their
neighbourhood is that they live too far from
other amenities
Noise problems Resident feels that a major problem with their
neighbourhood is noise or vibrations
Air pollution
Resident feels that a major problem with their
neighbourhood is air pollution from traffic
fumes, industry or other smoke
Access to
Resident can access most or all facilities
(such as; shops; schools; post shops;
libraries; medical services)
Condition of
Resident is very satisfied or satisfied with the
condition of facilities in the neighbourhood
Access to public
Resident is very satisfied or satisfied with
their access to public transport in the
Satisfaction with
public transport
Resident is very satisfied with the condition
of public transport vehicles, such as buses
and trains in the neighbourhood
Satisfaction with
council services
Resident is very satisfied or satisfied with the
quality of council services such as; water
supply; drainage; rubbish collection and
roads in the neighbourhood
Access to water
Resident can easily access all or most;
lakes; rivers; harbours; oceans and
Satisfaction with
state of water
Resident is very satisfied or satisfied with the
state of the lakes; rivers; harbours; oceans
and coastlines they have been to

Other dummy variables employed include: secondary urban; minor urban area; rural
area; regional dummy variables; year dummy variable; never want or need to go to
greenspaces; have not been to any of the greenspaces; public transport not
available in area; does not use public transport for other reasons.

Appendix B: 2: Baseline model results

Variable name Coefficient
(standard error)
Marginal effect

(standard error)
Demographic characteristics
Age (15-19) 0.7104***
Age (20-29) 0.2590***
Age (40-49) -0.0998*
Age (50-59) -0.1777***
Age (60 or greater) 0.3213***
Male -0.2661***
Mori 0.0068
Pacific 0.1270
Asian -0.1051
Have a child -0.0950**
Lone parent -0.2496***
Partnered 0.4614*** 0.0879***

This marginal effect is interpreted as residents having easy access to all greenspaces are 2.8057%
more likely to report being very satisfied (a life satisfaction score of 5) with their life than residents
who do not have easy access to all greenspaces.

(0.0411) (0.0078)
Physical health 0.0136***
Certificate 0.0428
Diploma 0.2269***
Bachelors degree or higher 0.2941***
Unemployed -0.7478***
Part-time 0.0404
Non-participant 0.1204**
Equivalised household income (ln) 0.1908***
Do not own home -0.0790**
Dissatisfied with free time -0.1291***
Civic life and social connectedness
Help in a crisis 0.5154***
Right amount of family contact 0.1572***
Not isolated from others 0.7050***
Voted in national elections 0.0577 0.0110

(0.0479) (0.0091)
Did voluntary work 0.3650***
Feel that they belong to NZ 0.3878***
Can express their identity 0.4296***
Crime and fear of crime
Experienced a violent crime -0.1038
Experienced a non-violent crime -0.6288***
Fear of crime -0.0978***
Greenspace access and quality
Access all greenspace 0.1471***
Satisfied with greenspace 0.2004***
Other neighbourhood characteristics
Deprivation index -0.0225***
Too far from work -0.2009**
Too far from other amenities -0.1858**
Noise problems -0.1534***
Air pollution problems 0.0199 0.0038

(0.0886) (0.0169)
Access to facilities 0.0717
Condition of facilities 0.3787***
Access to public transport -0.0088
Satisfaction with public transport 0.0348
Satisfaction with council services 0.1771***
Access to water bodies 0.0478
Satisfaction with state of water bodies 0.0892**
Summary statistics
Number of observations 15118 15118
Pseudo R
0.0848 0.0848
*** significant at the 1% level; ** significant at the 5% level; * significant at the 10%
Other dummy variables employed include: secondary urban; minor urban area; rural
area; regional dummy variables; year dummy variable; never want or need to go to
greenspaces; have not been to any of the greenspaces; public transport not
available in area; does not use public transport for other reasons.
Robust standard errors are reported for coefficient estimates. Unconditional standard
errors are reported for marginal effects estimates. Marginal effects are interpreted as
the probability of reporting being very satisfied with ones life (a life satisfaction score
of 5).

What are we teaching and why it matters: A survey of the Australian and New
Zealand university macroeconomics curriculum in a post-GFC, ecologically
stressed world
Judith McNeill
Jeremy Williams
, Michael Coleman

Institute for Rural Futures, Behavioural, Cognitive and Social Sciences, University
of New England, Armidale, NSW, 2351
Asia Pacific Centre for Sustainable Enterprise, Griffith University, South Brisbane,
QLD, 4010
School of Environmental and Rural Science, University of New England, Armidale,
NSW, 2351
The Global Financial Crisis appears to have brought a period of reflection, and some
uncharacteristic humility, on the part of the economics profession. The calls for
changes to what is taught now come from within the ranks of the mainstream.
Encouraged by this, we have examined first year macroeconomics courses taught in
2013 in Australia, New Zealand and some United States universities. We wanted to
know whether it is still true, as Herman Daly said in 1996, that economics textbook
writers (and teachers) still think that macroeconomics has nothing to do with the
We found that roughly one quarter of introductory macroeconomics courses appear
to include at least one aspect of environmental sustainability. No university in our
survey yet teaches an introductory macroeconomics course that would delight
ecological economists. By contrast, it became clear that at least three quarters of
courses and textbooks now include discussion of the Global Financial Crisis. We
think the disparity matters. Wide coverage of the Crisis introduces students to the
notion of the fragility of the financial system. However, for our policymakers and
business leaders of tomorrow, the increasing fragility of the natural environment
appears to remain a blind spot. Both are important, especially since escaping
recession and paying down high global debt levels will inevitably mean renewed
efforts to achieve high rates of economic growth. Unless an understanding of
sustainability is taught, we will have addressed one crisis, while hastening the next.
economics teaching, sustainability; Global Financial Crisis


How the economics curriculum should be revised has become a question of great
interest in the aftermath of the Global Financial Crisis (GFC). This is not to say that
critiques of mainstream economics teaching are something new. Indeed, as
ecological economists are well aware, the validity and relevance of neoclassical
economics came under the spotlight long before the drama of 2007-08. What is
different this time is that, uncharacteristically, there now appears to be an
atmosphere of openness and humility within the mainstream economics fraternity
that has not been in evidence previously
. As a result, the calls for change now come
from within the ranks of the mainstream community itself and not solely from those in
the wings.
Apart from the numerous websites and blogs discussing the state of economics and
economics teaching, influential economists of many persuasions are generating a
substantial literature including, for example, those economists affiliated to the newly
established Institute for New Economic Thinking (INET).
In October 2013, INET established a new project with the specific purpose of
designing a new approach to teaching undergraduate economics. The contributors to
the project will be spread across nine countries including India, Chile, Columbia and
Russia (The Economist, November 23, 2013 Keynes new heirs). Parallel
developments include a conference sponsored by the Bank of England and the UK
Government Economic Service discussing the teaching of economics, and the
subsequent establishment of a Steering Group to recommend reforms to economics
teaching in the UK (Royal Economics Society, 2013). United States based
contributors to the debate on economics curriculum reform include, among many
others, Schiller (2010), Blinder (2010), Gertler (2013), Reardon (2013), Hemenway
(2013) Krugman (2012), Friedman (2012), and Lo (2012). Schiller (2010) and Blinder
(2010) are currently listed as the Most Read articles in the Journal of Economic
Encouraged by the momentum on the issue, and the presence of ecological
economists at INET, we have conducted a survey of economics university curricula
in Australia, New Zealand and the United States. This paper reports on our
preliminary findings, specifically in relation to introductory economics courses and

Nobel prize winning economist Paul Krugman says, for example, a little bit of humility is a very
powerful thing(it acknowledges) that we don't have the truth and that maybe those beautiful models
weve been teaching are not the only way to see the world. (Paul Krugman and Joseph Stiglitz What
is the future of economic thinking? INET economics, Youtube, published November 1, 2013,
statement at 3mins, 39 seconds.)
Leading textbook writer David Colander echoes these sentiments when writing: humility, in my view,
is the missing element in economics teaching. Humility leads us to teach our students to become
scholars other than disciples. Humility begins with the recognition that no single approach is
sufficient. (Colander in Coyle 2012, Chapter 2, Loc. 510). Seabright and Carlin, also in Coyle (2012,
Chapters 11 and 13, resp.) express similar views .

the textbooks used by universities. Our focus is on the extent to which any of the
central ideas of ecological economics, or an understanding of sustainability, might be
appearing in courses or textbooks. A larger research project is looking beyond
Australasia and the US, and involves a broader, and more in depth critique of the
economics curriculum post-Crisis. These findings will be reported in a future paper.
Our broad goal in this paper is to establish whether it is still the case, as Daly noted
(1996: 46), that modern textbook writers think that macroeconomics has nothing to
do with the environment. Among the key ideas we looked for were the following: (i)
the notion that the circular flow of an economy is contained within a biosphere that is
finite, non-growing and materially closed; (ii) recognition that the capacity for
economic growth might be limited in the long run by planetary boundaries
(Rockstrom 2009); (iii) the idea that the environment, as natural capital, provides vital
ecosystem services to the economy, some of which go through markets whilst others
do not; and (iv) that Gross Domestic Product (GDP) counts the consumption of
natural capital as contributing to current income, amongst other shortcomings.
We also investigated how climate change is being treated. In Australia, respected
economist Ross Garnaut was commissioned by state and territory governments in
2007 to conduct an independent study of the impacts of climate change on the
economy the Garnaut Climate Change Review updated in 2011 (Garnaut 2008,
2011). Climate change is described by Garnaut as a 'diabolical and insidious
economic policy challenge, harder than any other issue of high importance that has
come before our polity in living memory' (Garnaut 2008: xviii). One might reasonably
expect the subject to rate a mention in introductory macroeconomic courses.
The paper is structured as follows: Section 2 provides an overview of the literature
that has urged changes to the way economics is taught in the pre- and post-Crisis
era and distils some of the key messages. This leads to a broader discussion on the
extent to which economics courses and textbooks are including these changes.
Section 3 presents the results of our investigations into the courses and texts. Our
rationale for seeking ecological economics concepts introduced at an introductory
level is then elaborated upon in Section 4, which also draws some conclusions on
the implications of our findings.
The calls for change
The lack of reality in, and narrowness of, standard economics principles texts has
long troubled ecological economists. A good deal of Daly and Farleys (2011, 2004)
textbook includes either explicit or implicit criticism of the narrowness of mainstream
theory and its unrealistic but canonical assumptions of insatiable wants and infinite
resources (e.g. text draws attention drawn to contrasting ideas such as optimal
scale, non-market goods, neglect of the biophysical system, GNP as cost, and a
need to re-define efficiency towards a more comprehensive indicator). Similarly, the
sheer breadth of subject matter in Common and Stagl (2005) highlights the limited

range and focus of conventional economics texts. Gowdy (2010) points directly to
many flaws in conventional economic thinking in his more advanced text. Not least of
these shortcomings is the absence of nature and society in the Walrasian economy,
and its view of a circular flow of economic activity that does not require energy or
other inputs from nature, or is the flow in any way limited by the laws of
thermodynamics. Furthermore, as the Walrasian circular flow does not model energy
inputs from nature, it is inherently incapable of recognizing the impact of the
discovery of fossil fuels. The ability of successive forms of fossil fuel to increase the
amount of useful work done (wood to coal, to oil, for example) has underpinned
astonishing increases in the living standards of developed countries during the
Twentieth Century. This remarkable feat, which also poses a great challenge from a
sustainability perspective, is a view of the world that is hidden in models that do not
link to nature or have a concept of the useful work of energy.

In one of the first edited volumes of the new field of ecological economics (Costanza,
1991), Clark (1991) and Zucchetto (1991) both addressed the problem of the
education of economists. Zucchetto (1991:416-427) stressed the importance of
developing a consciousness about the environment and an understanding of how
human actions need to be traded off against impacts on the natural world. Clark
(1991:400-415) analysed the attitudinal shift necessary to move students from
conventional economic thinking to that required for a more sustainable world.
Removing conventional economics from centre stage, Clark said, requires attention
to: the distribution of income as a priority; and the abandonment of linear thinking,
competitive individualism, neat mathematical models which, in fact, model nothing in
reality; notions that economies can only run on private greed and that planetary
costs can be validly counted as benefits (Clark 1991: 412).
Ten years later, when little had apparently changed, a significant event in the pre-
GFC economics teaching narrative occurred when a group of Parisian students
petitioned their professors against the imaginary worlds of their lectures. To fully
appreciate economic phenomena, the students asked that alternate critical
approaches be taught, rather than a purely axiomatic approach treated as the
economic truth (Fullbrook 2004: 3). This protest gathered momentum around the
world, and similar petitions were made in the UK and US. A new society and journal
were started, the Post-Autistic Economics Society, later renamed the Real World
Economic Society. Members of the Society, students and economics teachers,
contributed to a volume of writings entitled Whats wrong with economics?
(Fullbrook, 2004) Some of the main points from various chapters can be
paraphrased into a list of pleas for how to improve the teaching of economics:
stop banishing economic history and history of economic thought from
curricula, because these are where students are exposed to non-neoclassical

See Ayres and Warr, 2005 and Hall et al. 1986, as cited in Gowdy, 2010, Chapter

ideas (Fullbrook: 1).
recognise that one may need to look outside the boundary of economics for
some of the forces that drive economic behaviour (Stretton, 2004: 10).
rely less on methods of mathematical-deductive modelling in the desire to
appear scientific (Lawson, 2004: 26).
abandon the notion that there is a settled body of knowledge that students
simply need to absorb (Ormerod, 2004: 43).
adopt a more realistic version of the circular flow of an economy by depicting
it within, and reliant upon, the natural environment. In doing so, recognise that
the human economy has moved from an empty world era in which human-
made capital was the limiting factor in economic development to a full world
era in which natural capital has become the limiting factor (Costanza, 2004:
open students minds to the contested meaning of progress and discuss the
need for alternative indicators of wellbeing other than GDP growth (Gadrey,
2004: 262); and
teach economics as if ethics mattered (Wilber, 2004: 147ff).
Many of these pleas with respect to the teaching of economics are still being
repeated as the issue is discussed in the post-Crisis literature.
Soderbaum (2009), for example, repeats a request to open students minds to
alternative approaches. He suggests that neoclassical economics and its monopoly
position in economics departments is the reason the mental maps of people in
positions of power are faulty. Seeing individuals only as utility maximisers, firms only
as profit maximisers, and economic growth as the only objective in progress is a
problem because this pre-occupation with the monetary dimension, as Soderbaum
terms it, means that non-monetary factors such as ecosystems, natural resources
and human resources are seen only from their economic perspective. Impacts on
ecosystems, land-use, water resources and fish stocks raise issues of inertia, path-
dependence, irreversibility and connected uncertainties. These are obscured by the
monetary focus of the neoclassical view. The assumed universality of neoclassical
economics serves to legitimise it which, according to Soderbaum, means that
thousands of students, now in professional positions, have learnt neoclassical
micro- and macroeconomics over the years and have supported each other, and
been supported by, their professors to further strengthen the neoclassical
perspective (Soderbaum 2009: 16). For Soderbaum (2009) therefore, the
neoclassical perspective is therefore doubly condemned. Not only did it fail to predict
the Financial Crisis, but various ecological crises are unfolding that are obscured

from view.
Otsch and Kapeller (2010) argue that despite the overwhelming impact of the
Financial Crisis on the global economy, the effect on the education of economists
and economics as an academic discipline has been negligible. Noting Joseph Stiglitz
and Paul Krugman as exceptions, Otsch and Kapeller (2010:22) argue that most
economists find it very hard if not impossible to get distance to their own thinking
and detect a crisis of their paradigm. They suggest that in the neoclassical
ahistorical worldview, where markets are stable and self-regulating, it is hardly
surprising that macroeconomists were unable to predict the Crisis. They argue that
students will still be left illiterate with respect to such events if economic education
remains unchanged, as it appears to them it might. They suggest a pluralist
approach, whereby students are encouraged to debate the relative merits of a
variety of different theoretical perspectives, thereby getting an appreciation of the
inherent complexity of economic issues. They also argue for a problem-centred
approach to the teaching of economics and a return to the big-think questions
those that make economics interesting.
Like Soderbaum (2009), Reardon (2013) argues that the current generation is beset
by many problems including climate change, a Global Financial Crisis, a palpable
disparity in income and wealth, and a healthcare crisis. At the centre of this is the
discipline of economics itself and economics education, which obfuscates the
interrelationship of our problems, inures its students to human suffering and
abnegates thoughtful discussion of the human predicament (Reardon 2013:1).
Despite a collective failure of neoclassical economics to either predict or understand
one of the worst recessions in recent history, Reardon argues that little has changed.
The education of economists has at least three problems, according to Reardon: (i) a
failure to construct a workable model that reflects the real world; (ii) ignorance of
chaos theory, complexity analysis and evolutionary theory which have had profound
impacts in other social sciences; and (iii) the presentation of only one perspective,
denying the legitimacy of others.
Reardon (2013) writes: I am inspired by William Lloyd Garrison, who began
publishing The Liberator in 1831 and vowed to continue until the abominable
injustice of slavery was outlawed. Our generation is also enslaved by an outdated
and unrealistic neoclassical economics that ignores pressing environmental realities
and inures its practitioners to our generations many problems. Not least of our
possible problems, Reardon says, citing Shearman and Smith (2007), is our
inexorable slide toward cataclysmic climate change which will require wise warriors,
well rounded in disciplines such as economic history, literature, physics and political
Nelson (2009, 2013) makes an equally impassioned plea for action on climate
change and a change in the way economics is taught: (W)e are, if we are honest
about it, facing the possibility that all the skills and knowledge weve gained through

our physical and social evolution and scientific investigations to date may not be
adequate, or the right kind, to save the human race from catastrophic dislocating
changes. (Nelson 2013: 145).
She argues that in economics textbooks, we should be willing to take an ethical
stance on climate change; query with students whether pursuing self-interest and
accumulating more goods equates with wellbeing; explore how people come
together to take action; and add resource maintenance to our teaching of
consumption, production and distribution.
The contributions to Diane Coyles book, Whats the use of economics: Teaching the
dismal science after the crisis (2012), comprise a substantial literature on how
economics teaching should be improved, post-Crisis. The chapters, written by
prominent commentators, teachers and textbook authors make similar pleas for
reform. Some of these are reproduced in Table 1 as examples of the many ways in
which reform is urged.
What we are teaching
Course coordinators from 30 Australian and 7 New Zealand universities kindly
supplied detailed information on their introductory macroeconomics courses and the
textbooks used, often in the form of the full course guides. For comparison purposes
we also obtained from the Internet, publicly available information (often in the form of
a course syllabus) on introductory macroeconomics courses and textbooks used in
27 of the largest universities in the United States. For the Australian and New
Zealand universities, the 37 universities comprise more than 90% of those that teach
introductory macroeconomics.
Course content and relevant textbook chapters were examined for material in two
main areas: 1) evidence of an acknowledgement of sustainability concerns or use of
key concepts and ideas from ecological economics; and 2) content updating texts
and courses to include the 2007 GFC and its aftermath.
With regard to sustainability or ecological economics concepts, we looked for
mention of anything that links the economy to the environment as described in the
ecological economics literature in Section 2. Any discussion of ecological crises or
planetary boundaries also qualified as sustainability. For example, courses that
received a yes for sustainability in Table 2 included material on one or more of the
following: (i) definition or discussions on sustainability; topics on global warming or
climate change; (ii) a depiction of the circular flow of an economy having links to the
natural environment for sources and sinks, preferably by showing the circular flow as
embedded within the environment; (iii) specific recognition that GDP does not take
into account destruction or deterioration in the stock of natural capital; (iv) other
problems with GDP as the only measure of the well-being of citizens; (v) mention of
natural capital or raw materials as one of the factors of production or recognition that

Table 1. Post-crisis suggestions for reform of economics teaching: Messages distilled from Coyle (2012)

Teach the Crisis; economic history;
history of economic thought; and
institutional context
Reintroduce economic history into the curriculum because history teaches three important insights: the existence of
patterns, the importance of uncertainty, and the prevalence of multiple possible outcomes.
Integrate the history of economic thought and its relationship to events in economic history when explaining current
macroeconomic models.
Teach the economic history of the 1929 crash, the Great Depression and the 2007 crash. Emphasise the social and
political forces that lead to economic booms and busts.
First, to those schools that no longer teach economic history: reverse course. Integrate the teaching of history with
the teaching of theory and use history to explain why theories were developed in the first place.
Teach economic history in a way that includes an appreciation of how economic thinking about macroeconomics has
Link the macroeconomic theories to past events so as to show their weaknesses.
Ensure that the next generation of economists not only understand some of the causes of the Crisis, but also that
crises, recessions and crashes are part of the subject and not its death knell.
Economic history is our data, and it is as essential to economics as is knowledge of the constellations to an
There is a pressing need to reintroduce economic history into the teaching of economics at all levels. It was
awareness of economic history rather than of dynamic stochastic general equilibrium models that enabled the
authorities to muddle through the latest crisis.
Teach a greater institutional and historical context.
Teach the history of markets.

Teach a plurality of perspectives No single approach is sufficient. There is more to economics than one approach.
Incorporate a better understanding of behavioural economics.
Teach that macroeconomics is more than just forecasting the economy.
Broaden the extremely restrictive assumptions on individual motivations and opportunities.
Abandon homo economicus. Acknowledge that agents may not behave with the sort of extreme intertemporal
consistency often attributed to them.
Study current issues from a range of disciplinary perspectives (economics, history, international relations,
anthropology, economic history).
Teach real world economics Teach a broader knowledge of institutions.
Incorporate a significant element of project work and case studies into university programs.
Shift to a more policy focused approach.
Engage with the issues that confront real businesses and actual households.
Allow the students to get their hands dirty early on by actually collecting and analysing data about some empirical
Humility Teach passionately, but with humility. Open students eyes to the difficulties and challenges of economic models to
their usefulness, but also their potential fallibility.

an economy wide production function has raw materials or energy as factors of
production; and (vi) any recognition of the importance of the role of energy - as
useful work - in economic development, and the challenge of finding substitutes for
fossil fuels.
We examined for sustainability in macroeconomics rather than microeconomics
courses because we were primarily looking for recognition of the central idea of
ecological economics that the economy is contained within the biosphere, so that
optimal macroeconomic scale becomes an important macroeconomic policy issue.
Environmental externalities are almost universally discussed in modern
microeconomics textbooks within the topic of market failure. Whilst it is pleasing to
see any type of environmental impact acknowledged, the texts rarely go beyond
saying that the problem can be addressed just by correcting the price of the good or
service producing the externality to take into account the costs it is imposing on
others. The instruction to correct prices is one that fits easily within traditional
neoclassical economics and in that sense is nothing new. It underplays the fact that
where an environmental externality is widespread, or lasts for a long time, it is
impossible to know the right price. It ignores the fact that in practice, the
transactions costs of securing agreement for the many parties involved in non-rival,
non-excludable environmental externalities like global warming are likely to be
prohibitive, as the real world is proving. It neglects that many of the parties likely to
be affected have yet to be born and the fact that even if it were possible to get prices
right, and secure allocative efficiency for the current generation, this does not
guarantee the goal of sustainability because sustainability includes equity, including
intertemporal equity (Daly and Farley, 2011:193; Common and Stagl, 2005:350).
Our criteria for inclusion of sustainability issues fall well short of the coherent
narrative sought by Daly (2004) or Costanza (2004). As far as we can tell, no course
teaches optimal macroeconomic scale and our results are disappointing in that
respect. However, rather than ending the story here, we adopted less demanding
criteria and can, at least, report some positive results in Table 2 below. For
Australian and New Zealand, approximately 30% of undergraduate introductory
macroeconomics courses appear to discuss at least one or more aspects of
sustainability (as described above), whilst 44% of Australian postgraduate courses
satisfy this criterion. The position for the United States is similar, with 26% of the
universities sampled mentioning at least one aspect of sustainability in introductory
undergraduate macroeconomics courses.
Whilst we will be exploring this material at a greater depth in a second paper, one
example of the way sustainability issues were raised is in the seven courses that use
the textbook Case, Fair and Oster (2012) as their introductory macroeconomics text.
While not presenting the expanded circular flow model that embeds the economic
system within a finite natural resource system, Chapter 17 (Long run growth)
includes a two-page section entitled Growth and the environment and the issue of

sustainability. That section mentions, inter alia, the trade-offs between growth and
environmental quality; the relationship between economic growth and increasing
carbon emissions; and the question of how developing countries should use the
dividends from the exploitation of non-renewable natural resources. While this does
not represent the sort of fundamental revision of macroeconomic theory that
ecological economics might be looking for, it is evidence of genuine engagement
with some of the key dilemmas.
For teaching on the Global Financial Crisis, the nature of the material included varies
widely, and is far from settled, but revision of textbooks and courses for this
purpose appears to be much more widespread than it is for sustainability issues
(Table 2).
Table 2: Coverage of sustainability and the Financial Crisis in macroeconomic courses at
responding Universities, by country (percentage of courses incorporating each topic)

Country Sustainability GFC n
Undergraduate introductory macroeconomics
Australia 31.0% 75.9% 29
New Zealand 28.6% 85.7% 7
United States 25.9% 92.6% 27
Postgraduate introductory macroeconomics
Australia 44.4% 61.1% 18
New Zealand 0.0% 100.0% 2

Why it matters
Our investigations reveal that a number of economics teachers are keen to convey
an understanding of current sustainability issues when introducing economics to
students. That said, it is clear that the priority to change course content and texts to
explain the Global Financial Crisis has tended to overshadow the perceived need to
include concepts of sustainability.
Perhaps, given the immediacy of the GFC, this is not surprising. The economic
impacts of the crisis have been felt globally. Indeed, in some countries they have
been severe and the crisis has certainly drawn attention to clear gaps in mainstream
teaching and in the prevailing neoclassical theory.
By contrast, encroachments on planetary boundaries through global warming or
biodiversity loss, for instance, appear to have fewer immediate impacts that can be

unambiguously attributed to cause. They are also subject to denialist campaigns,
the influence of which would appear plain. Sustainability thinking asks us to consider
the future. Climate change, for example, asks us to imagine a future of frightening,
but unspecified economic impacts, and to ponder the big questions of designing an
economy and society that could be resilient, given the inevitability of these impacts.
On a more mundane level, it may be that amending courses and textbooks to
incorporate material on the Global Financial Crisis is perceived to be easier. To
some extent, it involves using existing theoretical building blocks (the liquidity trap,
for example) that had been dropped earlier.
From a purely practical point of view, however, our contention here is that changing
a textbook or course to include key sustainability concepts is not difficult either. The
simple act of drawing the circular flow contained within the environment, and
depicting the use of natural resources from that environment and wastes being
absorbed back into it (see, for example, Goodwin et. al. 2014, Figure 3.8, p.81.),
would go a long way to prompting discussions on sustainability issues that might
otherwise stay as blind spots. The essence of economic logic, that we economise
on, and invest in, improving the productivity of scarce factors of production, would be
retained. Stimulating questions could then immediately be raised. For example: Is it
natural capital or is it sink capacity that is becoming scarce? How do we invest in
this? What would a more comprehensive notion of efficiency entail if it included
environmental impacts? How could an economy be restructured towards one that
had more benign environmental impacts? What are the best policies to encourage
renewable energy?
Removing the blind spots and addressing such issues at an introductory level is
becoming critically important for several reasons. Firstly, it can often be difficult to
redirect young minds once they have been introduced to the primacy of efficiency,
narrowly defined, to economic growth as the sole goal, and to the economists (only)
way of thinking. The very similarity of textbook material seems to encourage a
conservative and unquestioning culture among both students and teachers, as
Soderbaum (2009) has claimed.
Specialist courses in sustainability for second or later year students can challenge
this thinking, and there did appear to be good courses at several universities.
However, unless such courses are included within a generalist MBA program for
example, few business leaders and policy-makers of the future are likely to proceed
to the more advanced electives.
The wide coverage of the GFC in revised textbooks and courses will have invoked in
students the notion of the fragility of the financial system. The levels of public debt
generated in avoiding the collapse of the system, and during the subsequent
economic downturn, were astonishing by post-war standards. In the United States,
for example, the level of public debt as a percentage of GDP is approaching the

wartime levels of 50 years ago (Congressional Budget Office, 2013). It took very high
economic growth rates by today's standards to bring war debt levels down over
subsequent decades. The largest economy in the world, and indeed much of Europe
since it is in a similar position, will be striving for economic growth with a renewed
desperation. Economic growth will be seen, quite validly, as a means of paying the
debt down without worsening unemployment.
New students will become acquainted with these ideas and priorities, but not with the
threats to the fragile natural environment that the efforts to achieve these high rates
of growth will pose. At the very least, it is important that business leaders and
policymakers appreciate that the drive for growth must strive for higher resource
productivity and fewer harmful emissions.
To sum up, in a survey of 30 Australian, 7 New Zealand and 27 United States
introductory macroeconomics courses at universities, very few of the key concepts of
ecological economics have made their way in any depth into the courses. About one
quarter of texts do mention at least one, seldom more, of five ecological economics
ideas for which we searched. This falls well short of a coherent narrative that sees
natural capital and ecosystem services as vitally important to the economy, and
climate change as a serious threat. By contrast a much higher proportion of texts
included new material to attempt to explain aspects of the GFC. The textbooks
introduce the notion of a fragile financial system into introductory macroeconomics
courses, but do not include the notion of the fragile environment on which the
economy is inextricably dependent. This poses a serious risk in our view. That risk is
that the policies chosen by policy makers and future business leaders to address the
first crisis (the GFC) may well hasten the next crisis (environmental).
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The Relevance of Charles Taylors Interpretivism for Environmental
Glen Lehman

School of Commerce, University of South Australia
* Email:
Environmental conjectures and refutations: Preliminary issues
In this article the work of Charles Taylor is used to explain how the relationship between
humanitys social and natural environments has been understood in Western political
philosophy since the Enlightenment.
In particular, the article considers the internal and
external reasons to debate and challenge how humanity thinks about relationships with
the natural environment. In this regard, the ideas developed by Charles Taylor are used
to critique political perspectives that are based on instrumental ways to reason about
the natural environment, because they invariably sever the connections between the
social and natural environment. Taylor postulates:
It seems to me that every anthropocentrism pays a terrible price in
impoverishment in this regard. Deep ecologists tend to concur from one
point of view, theists from another. And I am driven to this position from

The above quotation reflects Taylors openness to different values that may emanate
from within us or from the whole of nature. For Taylor, the full range of values which are
of critical significance for peoples lives may not necessarily be articulated and
expressed using scientific and technical methods. This article owes much to Taylors
discussion of interpretivism and his attempt to overcome the alienation of modern life.

Taylor argues that Enlightenment rationality has led to boosters of modernity, assuming that through
human autonomy and reason technological solutions can fix and solve ecological dilemmas: Charles
Taylor, The Ethics of Authenticity, (Oxford, Oxford University Press, 1992), 11-12.
Charles Taylor, Response to my Critics, Philosophy and Phenomenological Research, 54(1) (1994):
Alasdair MacIntyre explains that the adjectives communitarian, communitive and communist were
used interchangeably, and that the term communist incorporated many diverse strands of thought until
the early part of the 1920s; MacIntyre, A. (1995), The Spectre of Communitarianism, Radical
Philosophy, 70, 34-35. Some deep ecologists use the term communitarian in a different sense, referring
to a biotic community; see Callicott, J. B. (1996), Do Deconstructive Ecology and Sociobiology
Undermine Leopolds Land Ethic, Environmental Ethics, 18(4), 353-373.


Taylors interpretations relate considerations of broader environmental issues
associated with the quality of life and to general cultural and social relationships.
In this
article the term interpretivism
is used as representative of a particular approach critical
of contemporary liberalism and attempts to make clear to citizens what is happening in
their lives.
The article draws upon the interpretivist framework employed by Taylor to explore the
Enlightenments conception of rationality. Interpretivism is used to explore the
Enlightenments commitment to autonomy and the way it evaluates the natural
It examines the Enlightenments stress on autonomy and the way it
submerges political and ecological values. The article affirms what Taylor calls
- extending our understanding of autonomy to consider processes of
human self-realisation through exploring humanitys being in the world.
refers to human freedom and the ability to be impartial, but authenticity demands
contextualisation of that autonomy. The notion of authenticity helps in considering how
Aristotles practical reason can illuminate values other than those which reflect
instrumental considerations.
In particular, Taylors work on authenticity
informs the article such that the most
convincing ecological argument must be built on interpretivist premises. By way of
introduction, it canvasses liberal frameworks concerning nature and objections to them
from the perspective of deep ecology, far-from-equilibrium systems theory and post-
modernism. It then examines modern liberal frameworks counter-posing Taylors
authenticity to liberal infatuation with proceduralism. It goes on to explain Taylors
alternative, noting that Taylors moral framework takes a theistic direction. This chapter
asks: can Taylors approach be extended to escape anthropocentrism? It explores
whether we fully understand our impact on nature.
The key argument revolves around Charles Taylors attempt to preserve threatened
values by understanding perspectives on authenticity and expressivism which provide a
radical reworking of humanitys understanding of being-in-the-world, and a starting point

Cohen, J. E. (1998), How Many People Can the Earth Support?, The New York Review of Books,
XLV(15), (1998), 29-31.
Interpretivism involves: (a) the politics of the good and recognition of significant identity issues; (b)
peoples strong-evaluations which people find of critical importance; (c) the inter-relationships between
the right and the good that involves weighing the principles of neutrality against, for example, the right for
cultural survival.
See Hegel, G. W. F. Philosophy of Nature, Miller, A. V. (ed. and trans.), (foreword by Findlay, J. N.),
Oxford, Clarendon Press, 1970.
See Ferrara, A., Reflective Authenticity, London and New York, Routledge, 1998.
Dreyfus, H. (1994), Being and Time, (Massachusetts, Massachusetts Institute of Technology), 173-174.
Taylor, Ethics of Authenticity, op. cit.


for rethinking the way individuals and communities ought to be dealing politically with
ecological crises. Therefore, the argument in this articleuses Taylors work on liberalism
and interpretivist frameworks to construct a bridge between democratic, ethical, and
ecological perspectives. This leads to a fusion between liberal and interpretivist ideas
which involve the development of common ground to address cultural and
environmental values. This fusion of perspectives in the search for a common ground is
done in a spirit that aims to moderate the dominant anthropocentric attitude toward the
natural environment.
More broadly the ecological perspective developed here owes much to Taylors
interpretation of Martin Heideggers argument that people are thrown into the world.

Peoples identities are formed within cultural and linguistic traditions which frame the
factors which have significance in their lives. Clearly one crucially significant factor is
the way people relate to nature.
Heideggerian thought, moreover, is relevant to
considerations of what it means to be a person living a hectic life as if the processes of
time are accelerating.
Furthermore, it is important to remember that Charles Taylor
has been influential in developing the art of interpretation and applying it to issues
associated with environmental politics, multicultural recognition, and international
He has explored the problems that arise when we solely rely on modern
theories of knowledge that emphasize procedural political solutions using the
interpretivist framework.
There is a critical framework within the interpretivist perspective, a fact that has often
been overlooked by critics to whom his theological commitments are said to leave him
whistling in the dark.
Taylors interpretivist argument is that modern environmental and
political thinking has narrowed how the natural environment is conceptualized.
Interpretation also involves examining current theories of knowledge and explaining how
they have shaped the societies in which people live and their relationships with the
natural environment. This interpretivism determines the limitations and possibilities
within the dominant theories of knowledge as they apply to environmental and social
dilemmas. Central to the interpretivist framework is an argument that modern economic
and political sciences have created social practices that narrow how the environmental
and social dilemmas of modern societies are perceived.

Dreyfus, Being and Time, op. cit., pp. 173-174, 242-244.
See Taylor, C., Heidegger, Language and Ecology, Philosophical Arguments, (Cambridge, Cambridge
University Press, 1995), 123 and Taylor, C., Language and Society, in Honneth, A. and Joas, H. (eds.),
Communicative Action, (Cambridge, Massachusetts, MIT Press, 1991), 23-36.
Taylor, Ethics of Authenticity, op. cit., 7-10.
This interpretivist approach underlines Charles Taylor response to an empiricist critique leveled by
A.C. Grayling. Found in Ben Rogers, Charles Taylor Interviewed, Prospect, February 29, 2008, p. 4.
R. Hittinger, Charles Taylor: Sources of the Self, Review of Metaphysics, 44(1) (1990): 111130.


Therefore, Taylors framework transcends modernitys infatuation with procedure and
escapes the visions Max Weber conjured with the iron cage of bureaucracy.
On this
view, interpretivism moves beyond current political methods that are outgrowths from
economic and procedural strategies. These arguments reflect Taylors dissatisfaction
with approaches associated with instrumental reason and procedural liberalism and
invites rethinking what would be a full life and how people could strive towards it. To
save the natural environment and recognize values of political significance, Taylor gives
prominence to the power of a dialogic society. He is particularly critical of political and
procedural approaches that are insensitive to significant cultural and environmental
values. Taylor has recently pointed out that his key works, Sources of the Self and A
Secular Age, were inspired by a quest to better understand the plurality of worldviews
that have been used to explain the value of the natural environment.
Sources of the Self was underpinned by the belief that the natural environment and
humanity are entwined. When it comes to articulating different visions of the natural
environment, these critical issues require careful attention in a political sense. Hittinger
was one of the early reviewers to observe that the deep ecological and theistic
dimensions in Sources of the Self
left him reliant on an external and transcendental
That is, there is a theology that is crucial to, and yet left inarticulate in, Taylors
treatment of these issues.
These critical responses to Taylor, however, do not engage
with his philosophical and speculative quest to reveal humanitys relationships with the
natural environment.
One of Taylors principal aims is to reveal the anthropocentric
limitations within exclusive humanism which cuts people off from the possibility that
other sources of the self exist. Therefore, the interpretivist and narrative dimensions in
his work are designed to open a full range of values that the natural environment

The term of iron cage is that of Max Weber in his The Protestant Ethic and the Spirit of Capitalism
(London: Alan and Unwin, 1965); B.S. Turner, For Weber (Boston, MA: Routledge and Kegan Paul,
1981). Weber explained how modern bureaucracies perpetuate procedural structures that stifle the
human condition.
Charles Taylor, Challenging Issues About the Secular Age, Modern Theology, 26(3) (2010): 404416.
Taylor, Sources of the Self, (Cambridge, Cambridge University Press, 1989).chapters 1821. For a
critical perspective on the theological dimension see Redhead, M., Charles Taylors Nietzschean
predicament: a dilemma more revealing than foreboding, Philosophy and Social Criticism, Vol. 27, No. 6,
2001, pp. 81-107.
Hittinger, R., Charles Taylor: Sources of the Self, Review of Metaphysics, Vol. XLIV, No. 1, 1990, pp.
111-130. See also J. Casanova, A Secular Age: Dawn or Twilight? in M. Warner, J. Van Antwerpen, and
C. Calhoun, eds., Varieties of Secularism: In A Secular Age (Harvard: Harvard University Press, 2010)
Taylor, Response to my Critics, 13.


Taylor argues that liberalisms narrow focus is unlikely to accommodate environmental
values. Liberalisms procedural focus submerges the analysis of good structures. The
environmental limitation of liberalism is that it focuses on rights and individual personal
freedom as opposed to what is significant for a full life. That is, liberal doctrine looks
inward rather than to external things, such as the polis, or republic, and even less to the
environment. According to Taylor, morality is viewed in terms of self-interest or of de-
contextualised right. In eighteenth century terms, which many philosophers have now
forgotten, the Enlightenment collapsed ethics into morality. Morality (moralis) - being
true to a role is personal whereas ethics is about objective value structures (as in
Hegels Sittlichkeit, Taylor, 1975). Taylors criticisms of liberalism are evident in his
argument that Enlightenment thinkers such as Immanuel Kant reduced ethics (ethicus)
where the focus is on what I should be to morality where the focus is what should I do.
Kants categorical imperative acted as a yardstick for what I ought to do rather than
what it is good to be. Considerations of good political structures which might be
environmentally embedded have been displaced by considerations of principles of right
The essay begins by exploring background democratic and liberal issues that influence
ecological politics. The second section considers how Rawls theory of justice has been
extended to ecological politics and examines problems with extending liberalism beyond
its initial focus. The third section develops Taylors interpretivism in a collective and
environmental context.
The final section outlines how Taylors work on interpretivism
and practical reasoning might better accommodate environmental politics in the public
spheres of democratic societies.
Background Dilemmas: Liberal-Democracy and the Environmental Good
Liberal theorists such as Daniel Bell (2002), Will Kymlicka (1989) and John Meyer
(2011) adapt and examine central features of the liberal doctrine to address cultural and
environmental political issues. Taylors work is relevant in providing means to test
whether liberal environmentalism can recognise the natural environment as a hyper-
good, or strongly-valued good. These goods determine the outcome of other goods and
may not have a market value. A hyper-good is explained by Ruth Abbey who points out
that these goods orient us in shaping how we recognise the other goods confronting us.
She explains:
We judge them differently and perhaps experience them quite differently, to the
point of possible indifference and, in some cases, rejection (Abbey 2001, pp.


These goods include intrinsic values which require recognition as significant in peoples
life-plans. They are necessary conditions of our being-in-the-world. Many theorists
have worked to extend liberalism to recognise cultural and environmental goods in a
society where free citizens are able to live according to their own value systems, and as
they see fit. This is significantly at variance from Rawls liberalism, in that Rawls
advocated the belief that all societies would independently arrive at a set of values and
principles that would be viewed as common to all reasonable men and women in
different cultures. These attempts to reform liberalism have been examined by Bell,
Kymlicka and Meyer but this paper returns to Taylors critique of liberal attempts to
create new political pathways in a secular age.
For example, Will Kymlicka has responded to Taylor and argues that Rawls theory can
be extended to analyse cultural politics. Kymlicka claimed that Taylors reforms are not
necessary because liberalism can be adapted. He argues that liberalism can solve
cultural differences and remain stable.
This strategy has also been utilised in
ecological politics to extend liberalism to incorporate environmental values. However,
extending liberalism does not fully engage with how practical reasoning is used by
Taylor to interpret the significant dilemmas posed by ecological politics (See Taylor,
1992b). Procedural liberals tend to downplay the dialectic that can be developed
between interpretivism and the liberal predilection for procedural respect. Taylor
extends the parameters of respect through mutual respect to incorporate direct
engagements between people and the natural environment. These dialectical elements
are implicit in Taylors interpretivist politics which fuse horizons based on the notion that
mutuality is integral to respectful discourse. In this way, the value in the natural
environment is incorporated into the basic institutions of the public sphere.
For Taylor, the natural environment is the ultimate source of value and these themes
can be traced back to his work on Heideggers being-in-the-world. Taylor argues that
simply extending liberalism does not come to grips with our more basic interactions and
place in the natural environment (Taylor, 1994). More fundamentally, he argues that
modern liberalism loses sight of the significant moral values that shape our being-in-the-
natural-environment. He questions whether extending liberalism to integrate green
values into our democratic deliberations is enough (Bell, 2002).
A useful starting point in the argument is to remember that both Rawls and Taylor have
noted that their work engages ideas inspired by the philosophy of Immanuel Kant. The
latters essential theme is that each individual is sacrosanct and their rights are
inviolable. Kants focus was on the individual and principles of justice. Indeed, Kant
had very little to say about animal and environmental rights other than stating that it is
wrong to be cruel to animals. He formulated the idea of a categorical imperative,
where no person is to be treated as a means to an end (Kant, 1949, p. 96). In applying


a Rawlsian inspired version of Kant, it is argued that the diversity of individual interests
must be addressed as a moral term (Rawls, 1993, pp. xxviii-xxiv).
While Rawls adapts Kant because he believes that justice must be grounded in the
public sphere, the overall set of political values remains constrained by principles of
political neutrality (Ibid). The question is whether the environment is a necessary
condition of being and how our public spheres promote environmental awareness.
Kants categorical imperative and political approach has been criticised by Hegelians,
such as Taylor, as being based on a narrow and individualistic understanding of
community. However, despite Kants utilisation of transcendental arguments to avoid
these types of criticisms his work remains committed to the construction of procedure.
It is well known that procedural reasoning prioritises procedures of right over the
good. Taylor argues that despite Kants reforms to instrumental approaches the core
features of liberal atomism remain. This is a society where people act on their own,
without interference from others and the institutions of the state (Taylor, 1985). As we
will come to see, Taylors contention is that economic-liberal based environmental
reforms are hardly likely to create and nurture the type of appreciation that would put us
on a path to recognise environmental values. He offers an optimistic view that by
informing the people in the public sphere improved environmental outcomes will result.
Rawls political liberalism is significant because he releases liberalism from its
moorings in negative liberty and a minimal state. On Taylors view, we do not merely
need more liberal procedure and procedural respect. Rather, we need an ontological
and advocacy investigation into political pathways that put us in touch with the natural
world. His interpretivist thought offers answers to these questions through an
exploration into the connections between humanity and the natural environment which
challenges communities to totally transform how they interact with the natural
As Taylor notes in his recent work, A Secular Age, some of the impacts associated with
the rise of secularity rely heavily upon procedural principles. He argues that procedural
approaches emanate from the work of not only Kant but also David Hume. It will be
recalled that Kant awoke from his philosophical slumbers when he responded to
Humes claim that morality depends on some internal sense or feeling which nature has
made universal in the whole species (Hume, 1777, Part 1). Taylor argues that Humes
focus on sentiment has the potential to close thinking to the existence of intrinsic values
in the natural environment.
Taylor argues that while Kant is downstream from Hume both have developed ideas
that have shaped our secularising trends. Since the Enlightenments emphasis on
rights and justice this has created a tendency to submerge appreciation about the worth


of other beings and the natural environment. Ours is an epoch which has elevated
economic reasoning above interpretation in the public spheres of civil society. This has
created a disenchanted world view, one which reduces the natural environment to a
factor in economic production. Accordingly, the supposition that the natural
environment contains intrinsic values has been submerged in the endeavour to control
the natural environment. Taylor argues that our secular age has ignored other ways to
think about the world. He explains:
But that cant be the whole story The rise of modernity isnt just a
story of loss, of subtraction. The key difference were looking at
between our two marker dates is a shift in the understanding of what I
called fullness between a condition in which our highest spiritual and
moral aspiration point us inescapably to God, one might say, make(s)
no sense without God, to one in which they can be related to a host of
different sources, and frequently are referred to sources which deny
God. Now the disappearance of these three modes of Gods felt
presence in our world, while it certainly facilitates this change, couldnt
by itself bring it about. Because we can certainly go on experiencing
fullness as a gift from God, even in a disenchanted world, a secular
society, and a post-cosmic universe. In order to be able not to, we
needed an alternative. (Taylor, 2007, p. 26).
On Taylors view it is important to understand how we have moved between enchanted
visions of the universe and a prevailing disenchanted worldview. This argument leads
to the main point of his recent work: that a secularist rgime must manage the religious
and metaphysical diversity of views (including nonand antireligious views) fairly and
democratically. (Taylor, 2011). This might include setting certain limits to
environmental, religious and spiritual actions action in the public sphere (Taylor, 2010e).
Yet, for Taylor, religion is not the primary focus of secularism because the aim is to
explore new ways to effectively re-enchant the system. In this way, our horizons of
environmental value are broadened and the role of public institutions developed. For
this to occur, not only do environmental concerns need to be considered within a
societys collective thinking, but environmental values must be recognised in the
deliberative and educative process. Taylor argues that our ideological and political
structures have become closed world structures which deny the existence of intrinsic
environmental values. The economic focus on sustainability tends to close off ideas
about our place in the natural environment and what our relationship to it should be.
Central to Taylors art of interpretation is the view that liberalism operates within a
narrow understanding of the factors important for a full life. He has argued that liberal


attempts to define the natural environment as a primary good provides superficial
interpretations about what it is good to be. He argues that liberalism tends to
homogenise identity because it has been extended beyond the bounds for which it was
originally intended. Taylors work implies that we need to totally rethink our basic set of
assumptions and directions for our communities. He has argued that a collectivist
approach focuses on common bonds that can provide workable environmental and
social solutions. The environmental issue is not simply about justice, but creating new
pathways to recognise that the natural environment is a necessary condition of being.
Taylor explores the notion of a steady-state community is one that explores the limits of
the current system that has created our present pattern of inequality [which] is made
provisionally tolerable only by rapid growth (Taylor, 1978, p. 168). This is the dilemma
the environment poses on people freely choosing their own values. Environmental
politics challenges modern political systems to determine when such external values are
significant for the political system. This is the classical problem positive liberty poses for
modern societies and their governing systems. The problem for democratic-liberalism is
that not all environmental values and voices can be heard equally. A decision in favour
of development obviously overrules the environmental objections of those who oppose
it. This issue reflects the pragmatic mantra that it is not possible to focus on all peoples
values at the same time. This maxim, while lacking Kantian categorical force, could be
used to argue that the dominant voices submerge other ways of being-in-the-world.
The problem is when should the state provide special treatment for environmental
values which might conflict with the need for all citizens voices to be expressed (and not
just periodically when elections are held). Taylor addressed the issue of equal voices:
Another obvious difficulty for a liberal defense of community aspirations
is the element of coercion and discrimination it may unavoidably entail.
Suppose a minority of members want to assimilate. But suppose, at the
same time, that the laws needed for the survival of the community
require everyones support. So all members of the community are
taxed, say, to support some institutions; or in the name of survival,
which a minority are happy to forgo, their choice of language is
restricted. Once we get caught in the rigid requirement of equal
concern for everyones view of the good, are we not forced here to
violate our principle [of equality]? (Taylor, 1994a, p. 261).
This issue applies to environmental politics which is addressed in the interpretivist
emphasis on social frameworks that inform citizens about these dilemmas. This
involves accommodating two critical features of deliberation. First, citizens have
opportunities to participate in the formation of the good. Second, citizens may find
themselves in agreement with a government or state on some points, and not on others.


These two issues reflect the problem for modern liberal extensionism concerning what
to do when the polity is divided on matters environmental. Obviously, environmental
concerns may be in direct conflict with economic imperatives and realities. In early
political theory it was assumed that mechanisms of power such as an absolute
monarchy or a benevolent dictatorship were the means to create and nurture a general
will. From Taylors work on identity and liberal secularism, the key issue involves the
development of deliberative structures throughout society to critically analyse, inform
and nurture the significant values that shape our being-in-the-world. At the very least,
Taylors explorations about our being-in-the-world offers steps toward the creation of
new directions for modern communities.
However, before exploring Taylors critique of liberal extensions, it is necessary
to examine how Rawlsian liberals have adapted the doctrine to ecological politics. This
is important if we are to understand how political liberalism has been applied and, why
Taylor now points out that at the time nobody thought Rawls was out of his mind to try
to decide between different principles of justice with the aid of rational choice theory
(Taylor, 2007, p, 64). For Taylor, during the past three decades criticisms of Rawls
were in a distinct minority, as the Rawls boom showed.
John Rawls Political Liberalism and the Environment
One of the most prominent exponents of liberalism, John Rawls, created a social theory
which was intended to reform capitalism by creating fairer relationships between people
in a civil society. However, his Theory of Justice has subsequently been adapted to
address environmental issues as well as some of the criticisms outlined in the preceding
section. Rawls is a trenchant critic of utilitarianism, but despite the affirmations of some
of his admirers, his starting point is not rights but intuition. Though the criterion of
intuition could be an important aspect of any bridge between procedural liberalism and
interpretivist authenticity, Rawls himself is a procedural thinker.
Rawls began his political journey with a concern for procedure and decision-making in
ethics, returning to it in Political Liberalism (1993). In Political Liberalism Rawls
bracketed the metaphysical from the political, offering a number of pragmatic
recommendations to reform modern liberal-democracies (See Rosenthal, 1996). The
crucial question is whether Rawls responds adequately to the new saliencies such as
cultural and environmental politics. In his A Theory of Justice he is clearly aware of the
...Theory leaves aside for the most part the question of the claims to
democracy in the firm and the workplace, as well as that of justice
between states (or peoples as I prefer to say); it barely mentions
retributive justice and the protection of the environment or the


preservation of wildlife...The underlying assumption is that a conception
of justice worked up by focusing on a few long-standing classical
problems should be correct, or at least provide guidelines for
addressing further questions. (Rawls, 1993, p. xxviii).
To deal with these issues Rawls offers a constructivist framework which some have
adapted to considerations of nature through discussion of what Rawls calls primary
According to Rawls, the citizen must ultimately choose which of these is more
primary to the fulfilment of their personal life plans. Here, Rawls was operating with an
internal reasons approach to political matters but he did not deny the possibility that
external reasons may exist and command peoples allegiance. But is this incorporation
of communitarian and interpretivist ideas sufficient to deal with ecological concerns?
That is, how does Rawls method conceptualise authenticity in an environmental
context? The answers to these questions are to be found in the extent to which Rawls
liberalism can incorporate authenticity under the rubric of what he calls respect and
Rawls attempts to avoid criticisms such as Taylors interpretivist critique by grounding
Kants categorical imperative within the public culture of a liberal-democratic society.
He explained it as an ideal conception of citizenship for a constitutional democratic
regime, because it takes people as a just and well-ordered society would encourage
them to be. (Rawls, 1971, p. 11). The question is whether such a political structure can
accommodate environmental values as a comprehensive political value. That is,
whether simply ordering environmental differences according to a constitutional
framework is enough to recognise nature as a condition of our being-in-the-world.
In later work, Rawls observed the need to alter the principles of justice to accommodate
salient issues such as work-place reform, the environment and international relations.
Liberal theorists emphasize individuality, autonomy, and the inviolability of human rights
for people to choose their own life plans as they see fit. The ideology has an emphasis
on the rule of law and in upholding the freedom for people to determine principles of
justice using their own sense of individual practical reasoning. This means that
individuals can abstract away from circumstances and contingencies in constructing fair
and just principles.
It is worth remembering that in liberalism there are competing notions and arguments
involving the the right and the good. The good is concerned with an ordered scheme
of final ends and by extension the type of world in which we would want to live.
Principles of right, by way of contrast, involve the derivation of principles of justice.
Rawls liberalism develops the principles in a framework that determines the ordered
scheme of final ends. According to Taylor, however, Rawls moves away from ontology


to advocacy, but leaves open ontological thinking to supplement his work (Taylor,
2007). The question is, however, does he bridge the liberal-interpretivist divide?
Proponents of liberalism argue that it is capable of refinement and can evolve to
emerging and significant issues even though these revisions have created a pastiche of
ideas. In this regard, even Taylor seems to agree, saying that [e]valuation is such that
there is always room for re-evaluation (Taylor, 1976, p. 296). However, where the
liberal and interpretivist schools of thought differ is that the liberal doctrine claims to be
able to respond to contingencies as they arise. In part, this has been a response to
criticisms by interpretivists that liberal doctrine is inconsistent and unable to
accommodate significant factors associated with peoples identity and their being in the
world. More particularly, Rawlss revisions to political liberalism and concessions to
comprehensive doctrines continue to be shaped by the current legislative and social
structures. Rawls states:
[A] bill may come before the legislature that allots public funds to
preserve the beauty of nature in certain places (national parks and
wilderness areas). While some arguments in favour may rest on
political values, say the benefits of these areas as places of general
recreation, political liberalism with its idea of public reason does not rule
out as a reason the beauty of nature as such or the good of wildlife
achieved by protecting its habitat. With the constitutional essentials all
firmly in place, these matters may appropriately be put to a vote.
(Rawls, 2001, p. 152).
Despite the many complex moves Rawls made to Justice as Fairness: a Refinement the
fundamental liberal doctrine remains locked into the current political system. This
argument is made noting the urgencies of the environmental crisis. The implication of
Taylors argument is that it might be too late to wait for intermittent elections to solve
these democratic conundrums. That is, the core environmental problem is how to
recognise significant goods without compromising principles of justice. The point is for
democratic systems to act authentically, create and offer opportunities for citizens to
participate in the construction of a good society.
Furthermore, critics of Rawlss liberalism point out that while the two principles of
justice, the notion of primary goods and of an overlapping consensus are
straightforward, liberalism has proven problematic and inadequate in how these
principles are to be satisfactorily applied. Such criticisms fall into four main categories.
First, that liberalism is an overall model which is becoming increasingly complicated and
has lost its original force as it is continuously adapted to address modern contingencies.
Second, that such liberalism only addresses a world model in terms of anthropocentric


values. Third, that it assumes its solutions are universal and derived from ahistorical
principles between societies. Last, that it considers all members of society are entitled
to an equal share of societys resources.
These issues are reflected in extensions to Rawls political liberal attempt to include
environmental values in democratic voting. Obviously, this was not an original part of
the constitutional arrangements that existed. In this regard, interpretivist theorists
advocate democratic models work to provide opportunities for people to understand
how humanity relates with the world. In response liberals argue that existing institutions
can be transformed by reasonable citizens in an overlapping consensus. Accordingly,
Rawls believed he could accommodate communitarian and interpretivist criticism by
continuing to uphold the fundamental notion of freedom of choice and equality (Rawls
first principle of justice). Rawls himself later addressed critics of his theory by moving to
a revised model in which he emphasised politically neutral values that would be
accepted by all. The term politically neutral refers to how supporters of different
comprehensive doctrines can agree on a specific form of political organization. These
doctrines may include religion, political ideology or morals. The overlapping consensus
is based on there being a morally-significant core of commitments common to the
reasonable fragment of each of the main comprehensive doctrines in the community.
It remains problematic, however, whether a liberal system committed to an overlapping
consensus can create a vision of the world which engages with the notion of significant
environmental values and their intrinsic value.
This reflects Rawls commitment to constitutional principles, and a move away from a
fixed model of justice to a more situation-based framework of reasoning. The new aim
was to liberalise environmental issues in terms of justice and rights. In this way,
liberalism attempted to side-step claims it was incompatible with environmental issues
and local community politics. Additionally, the system Rawls said he was trying to
construct was not based on a Western point of view, and was a more neutral system
than previously. Bell summarises Rawls argument:
If something is a good, politically speaking, it makes a positive
contribution to the maintenance of a co-operative society of free and
equal citizens, each with the capacity to form, revise, and pursue their
own doctrines, and the ability to live by principles of justice appropriate
for such a society.

(Bell, 2002, p. 705.).
However, history has shown that principles of justice vary among communities as much
as cultural and social values. Where societies potentially come into conflict is where the
values of one community collide with those of another. Indeed, environmental ethicists


such as J. Baird Callicott has pointed out that certain native tribes may dismiss current
Western culture being on the wrong track because we are not connected with the land.
Rawls revisions to his theory of justice indicate a willingness to engage with critics and
refine his principles (See Wolff, 1977, p. 202). His later thinking is influenced by the
arguments of Will Kymlicka (1989) which was a reaction against the belief that
communitarians impose certain conceptions of the good on citizens. Liberals respond
to communitarians by developing the idea of primary goods which allow people to
identify and pursue what is significant in their lives. The initial focus of Kymlickas
liberalism was to accommodate cultural values through an explicit concern for culture
and the articulation of associated minority rights (Kymlicka, 1989, 1997, p. 77). He
claims that major liberal theorists had not addressed this area. It is then a short step to
integrate significant political contingencies, such as cultural and environmental values,
into the societal structure. If Kymlicka considers minority rights can be accommodated
easily the problem becomes how to accommodate environmental rights. Meanwhile,
liberal progressives remain committed to principles that exist within the boundary
conditions of that systems understanding of the relationship between people and the
natural environment.
Where the aim is to integrate cultural matters of significance into the more basic
structure of a liberal society, Kymlicka states that it is obvious that some national
minorities like some majority nations are illiberal and restrict choice. The implication
is that communitarians try to assimilate members to the liberal majority culture.
Kymlickas solution is not to assimilate the minority culture, but rather to liberalize it
(Ibid, p. 77). The inherent issue with this statement is the belief that those who are
illiberal will be accommodated to the extent to which liberalism can transform their set
of values. He argues therefore that liberalism is not hostile to Taylors interpretivist
social thesis that cultures should be protected, and that it can be adapted to
accommodate group rights. Liberals extend the same process to environmental politics
to accommodate humanitys relationship with the natural environment.
Taylors Interpretivism and Respect for Nature
Taylor criticises liberal theory based on the argument that extending an ideology does
not directly address the new political salience, in this case that of the natural
environment. The liberal response has been to note that liberal societies are not
necessarily in conflict with green values (see Bell, 2002, p. 710). Interpretivists contend
that the existing liberal model of the world cannot be adequately refined, as it is limited
by an anthropocentric understanding of the world.
Taylors response is that the liberal solution only offers a superficial understanding of
reconciliation, even if liberalism is defined more broadly. It has not begun the process


of reconciling these differences on terms that both sides of the dispute can understand.
Commenting on Kymlicka, Taylor notes that he seems to reduce culture which is a
vital constituent of identity - simply to a resource:
What has happened is that a proponent of liberalism has found his own
reasons to support the struggle for cultural integrity of some peoples,
who for their part are engaged in this struggle for their reasons. The
two are not the same. The liberal accords a culture value as the only
common resource of its kind available for the group in question. It is the
only available medium for its members to become aware of the options.
If these same individuals could dispose of another such medium, then
the case for defending the culture would evaporate. For the people
concerned, their way of life is a good worth preserving; indeed, it is
something invaluable and irreplaceable, not just in the absence of an
alternative, but even if alternatives are available. (Taylor, 1994, pp. 259-
Taylor insists that liberals only manage the demands of cultural and environmental
issues through procedural recognition. Thus, the liberal approach focuses on rights-
based principles and peoples conceptions of how they want to live their lives, whereas
the latter is about the development of commonalities that visualise humanity as a part of
the world. The interpretivist approach emphasises commonalities and issues of
Justice is not simply an overlapping consensus but might involve giving ground to
create better relationships. Otherwise justice may prima facie be seen to be done, while
obfuscating the injustices, discrepancies and other inequalities that exist in the world.
These problems translate to the international relations dimension and require careful
negotiations about sustainable futures. A further example is that of the claims made by
workers in the logging industry for a natural right to work which inevitably clashes with
the environmentalists claim for green natural rights and preservation. These two
political goods, the right to work and the value of the environment, are primary goods
which are needed to satisfy peoples life-plans. The question that presents itself is how
Rawls lexical ordering of these goods will lead to solutions that conflicting parties will
come to recognise as legitimate.
Taylors contrary approach focuses on the provision of reasons that disputing parties in
democratic structures can concur. His reforms to liberal-democratic structures involves
not only thinking about the good life, but how our institutions of governance provide and
inform the public spheres to inform citizens concerning the value of the natural
environment. Of course, the road to green and sustainable societies is never going to


be easy. It is obvious that political arguments for more discursive public spheres are
unlikely to be supported by proponents of market reforms.
The first point of interpretivism is to provide ideas for new structures to accommodate
environmental values. In this respect, interpretivism challenges environmental and
social theorists to consider how the natural environment shapes the options and values
that are critical for our horizons of value. It is through practical reasoning that
significant features of human identity are explored and this requires redesigning our
basic institutions to consider these issues (Taylor, 1969). Moreover, political
mechanisms and structures of governance must be developed to account for the fact
that humans do not exist prior to their understanding according to the interpretivist
framework. They are constituted by it.
For Taylor, simply bringing an issue into the societal structure according to liberal
principles offers only procedural respect. The granting of cultural or environmental
rights does not come to terms with how these values shape peoples identity.
Therefore, the respect granted is limited by the contours and forces of the pre-existing
system. These limitations submerge not only creative solutions but the role for
perceiving and feeling the intrinsic values that are contained in the natural environment.
He argues that this dilemma requires the exploration of how intrinsic values are a
commonality that must be incorporated into deliberative processes. Alternatively, such
values may be accommodated to the extent that the system allows for those additional
values, even if they are presently not at all common.
However, when a social system has external and intrinsic elements imposed upon it, or
presented to it, to which it has no natural affinity and no pre-existing mechanism by
which those elements may be introduced and embraced, conflict invariably is the end
result. In recent work he has observed that we are crippled by many of our policies. He
I think the way to conceive [of] our situation is that we are living through
a set of extremely painful dilemmas, and are going to go on doing so.
In other words, capitalism is, if you like, the source of a number of
terrible dilemmas. We cant live with it; we cant live without it. We cant
live without it because its tied to certain kinds of growth and so on.
(Taylor, 2008, p. 15).
Taylors solution is in part to recognise that searching for universal solutions is likely to
fail, but that compromises must be made. That is, once we outline not only the type of
society we want to live in, but how our priorities shape our basic institutions. For Taylor,
if political theory is to assist the collective dimensions of community structures, there
exists a role for the state in creating conditions for dialogic interaction concerning goods


of significance. The role of the state will involve consideration of the commonalities
between people and the natural environment.
For Taylor, at the root of the contemporary problem is the liberal construction of the self
which has been moulded by processes of secularisation (see Taylor, 1985). These
processes see the liberal self as independent from the interests and attachments we
may have at any moment in time. Yet, much environmental value is deemed to be
intrinsic, and also essential for realising a good life. In this respect, environmental
harmony and preservation are also essential to humanitys understanding of the good
life, even if the market does not necessarily create a desired political outcome. Taylor
explains that the ideal of authenticity and the search for significant values engages a
depth of thought that using a fixed liberal yardstick cannot. That is, interpretation
questions why we defer to neutral principles and yardsticks of justice in the first place.
He states:
[I]t is uncommonly difficult to reflect on our fundamental evaluations
the obstacles to this way of thinking are deep and make us want to
turn away from this examination. Some of our evaluations may in fact
become fixed and compulsive, so that we cannot help feeling guilty
about X, or despising people like Y, even though we judge with the
greatest degree of openness and depth at our command that X is
perfectly all right, and that Y is a very admirable person. This casts light
on another aspect of the term deep, as applied to people. We
consider people deep to the extent, inter alia, that they are capable of
this kind of radical self-reflection. (Taylor, 1976, pp. 298-299).
Taylors work on depth thinking connects with his dialogic reforms to democratic theory.
This vision of democratic thinking aims to express values submerged by rights-based
thinking. Indeed, this Hegelian framework might be idealistic, but idealism should not
be misinterpreted for an enthusiastic attempt to create a common ground. The
commonalities canvassed in a dialogic society include ecological matters otherwise
submerged in an efficient and ordered world.
Here Taylor draws a distinction between the public sphere of our modern age and the
public sphere of the ancient republic, or polis. Taylor develops Michael Sandels
argument that procedure ignores attempts to explain how the world is ultimately full of
meaning (Sandel, 1982, p. 175). Procedure simply orders differences without fully
coming to grips with the underlying dilemmas that they represent. He is particularly
critical of representative systems that limit the means through which we can imagine
and develop a new conception of ecological politics.


More fundamentally, a procedural system has the potential to create a bureaucratic
structure from which we cannot escape. As an example of the type of democratic
reforms, Taylor suggests a return to an earlier way of moderating power in a public
forum, the ekklesia, which would be called for in the Greek city states when their
governments had become too corrupt and oppressive (Taylor, 2007, p. 189). This was
an assembly outside the civil authority of the city and if enough people came out and
refused to accept the existing centralized civil authority that government would collapse.
Non participation has been a successful and peaceful means to free mankind from
oppressive civil authority throughout history.
Taylor emphasises the power within communities that can ultimately remove governing
bodies that stifle the human condition (Ibid). The purpose of this exercise is to recall
how these ancient models included discussion outside the decision making bodies of
governance. Through improved interpretations and improved discourse it is possible to
subvert the current order of things. The difference between the ancient polis and the
public spheres of today is that in the ancient polis people could hold governments to
account. Taylor explains:
Now there is a subtle but important difference. Lets compare the
modern society with a public sphere with an ancient republic or polis. In
this latter, we can imagine that debate on public affairs may be carried
on in a host of settings: among friends, at a symposium, between those
who meet in the agora, and then of course in the ekklesia where the
thing is finally decided. The debate swirls around and ultimately
reaches its conclusion in the competent decision-making body. Now
the difference is that the discussions outside this body prepare for the
action ultimately taken by the same people within it. The unofficial
discussions are not separated off, given a status of their own, and seen
to constitute a kind of meta-topical space. But that is what happens
with the modern public sphere. It is a space of discussion which is self-
consciously seen as being outside power. It is supposed to be listened
to by power, but it is not itself an exercise of power. (Ibid).
In the modern public sphere these debates are being seen as outside of power. With
the rise of the modern public sphere comes the idea that there is a need for political
power to be checked because of the separation from the people. It is in this sense
extra-political. A Secular Age contains a perspective on language that is designed to
provide better interpretations that act as a metric to adjudicate between different
narratives. He argues that the power implicit in improved interpretations can be used to
moderate the excessive scope bureaucratic reason has in the modern world. These


ideas are not about idealising the public sphere, but engaging with capitalist dilemmas
that have led to massive environmental and social inequalities.
The argument for change through the public sphere is based on the view that the
economic and material causes of our current dilemmas can be moderated by an explicit
political approach that investigates the ideas behind them. After all, it is human
communities that have created the economic systems that divorce people from each
other and their natural environments. According to Taylor, the public sphere is the
arena to reveal the moral worth of different visions of the good life.
This essay employed Charles Taylors criticism of liberalism and its secularising
structure to explore environmental values as a source of the self. The value of
liberalism is, of course, its emphasis on the rule of law and its sincere commitment to
the protection of fundamental individual rights, reflecting certain common features
among all people. Its shortcomings have been its proceduralism, instrumentalism and
the priority it gives to negative freedom without exploring what is significant for identity.
Taylors interpretivism may supplement liberalism in these respects and particularly by
casting freedom in a more positive way. That is, as self-determination which is involves
a role for the state by recognising differences and environmental values.
It has been argued that Rawls endorses negative freedom and is somewhat suspicious
of the state. He has been criticised, moreover, for offering us no theory of the state.
Nevertheless, if limits to growth become real, Rawls principles of justice demand reform
to accommodate environmental values. The state is vital in providing a democratic
forum within which to foster ecologically aware politics which will not emerge
spontaneously but must be forged by democratic institutions. Taylors work emphasised
a role for the state that involves the public sphere, and involved more than state
directives for sustainable futures. It involved shaping our civil societies in a manner that
counters both corporate power and excessive state power in policy.
Therefore, Taylors work on environmentalism and secularism is to recognise that there
is more to peoples identity than simply following a liberal procedure and rule. The
ecological implication of Taylors interpretivism is that environmental values must be
implemented through advocacy of a politicised civil society. That is, where the state
and its institutions influence but do not determine how people are to live their lives.
These visions for an environmental world are guided by a normative commitment which
respects the value in the natural environment.


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Some might argue that liberal societies do not have to be capitalist, but it is difficult to think of any liberal
society which is not economically organised on capitalist lines (see Bowles, & Gintis (1987)).
Rawls (1993, p. 27n) stated that Will Kymlickas response to communitarianism is on the whole
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explanation of how his political liberal principles can be adapted to incorporate environmental concerns,
see Rawls, Political Liberalism, op. cit., pp. xxviii-xiv.


Fair Water Distribution
Anna Lukasiewicz

MDB Futures Visiting Fellow, ANZSOG Institute for Governance, 22B12 Innovation
Building, University of Canberra, Canberra, ACT 2601
The Millennium Drought in Australias Murray-Darling Basin (MDB) has accelerated
ongoing water management reforms, which have been marred by bitter
confrontations between various user groups such as irrigators, rural communities
and government officials. Accusations of unfairness and injustice abounded,
however decision-makers have limited guidance of how to ensure fair water
distribution. Previous work has identified that during the Millennium Drought, water
distribution in the MDB was guided by three competing principles: need, equity and
Drawing on data from the original research, this paper examines how these three
principles have been implemented and what their consequences have been for
different stakeholders (landholders, the environment, and Indigenous peoples) in one
part of the MDB. The implementation of equity and efficiency has resulted in
significant benefits to those who already benefitted from (and therefore contributed
to) the agricultural system (irrigators more than croppers and graziers). This was
balanced by the expressed recognition of basic needs for previously excluded
stakeholders (like the environment and Aboriginal peoples), which potentially puts
them in better stead for the future. Instead of determining which principle is fairest,
this analysis explores the consequences of all three to illustrate the difficulty of
achieving fair water distribution.
social justice, distributive justice, water reform, Murray-Darling Basin, drought
Water governance in the Murray-Darling Basin (MDB) becomes a salient political
issue only during floods and droughts. It is currently the subject of ongoing reforms
whose latest iteration started in the 1990s. The recent Millennium Drought (2000-
2010) was a time of extreme water scarcity that exposed many conflicts over how
we, as a society, use water in the Basin. In this paper, three principles of distribution
evident in Australian water management are discussed: need, efficiency and equity.
Instead of suggesting which principle is fairest, the purpose of this paper is to
explore the consequences of these three principles on different stakeholders (the


environment, floodplain croppers and Aboriginal communities), and thus expose how
our understandings of justice are affected by our point of view.
This paper starts with an explanation of the water reform process during the
Millennium Drought followed by a brief review of social justice concepts used in the
analysis. The research methodology is then explained along with the case study,
followed by a discussion of the results where the consequences of distributive justice
principles are organised around the three stakeholder groups examined.
Water Reform
The current Australian water reform process started in the early 1990s and continues
to this day with the implementation of the Basin Plan. Evaluations and descriptions of
the reforms abound (Baldwin et al., 2009; Crase, 2008; Matthews, 2011) and a
thorough description is beyond the scope of this paper. However several points most
relevant to the MDB require emphasis. Historical water management focused on
intensive irrigation as a way of developing the state (Hillman, 2008; Schofield, 2009).
This promotion of irrigation was seen to be in the public interest, with both the
government and community supporting a growth ethic (Connell, 2007). In the 1970s
and 1980s focus began to change from production to conservation (Godden, 2005)
as community support for the environment came to the fore (McKay, 2002),
prompting water managers to consider environmental and social policy objectives.
There was a move away from engineering works to catchment conservation and
restoration (Hillman, 2006), highlighting the role of local communities as
The Millennium Drought started in the late 1990s in some parts of the country and
broke in 2009 or 2010, depending on the location. It influenced the 2004 National
Water Initiative (NWI: Australias blueprint for water reform) and spurred on the water
reform process. The severity of the Millennium Drought was compounded by the
growth in development, over-allocation of water licences in the MDB and climate
change (Kendall, 2010). Engagement of diverse interests (such as environmental or
local community interests) became recognised as important, and managers had to
incorporate social and environmental considerations into a process that was
previously purely technical. Following the launch of the NWI in 2004, access to water
and water management for Aboriginal people became an important part of reforms.
The environment also emerged as a water stakeholder with the Commonwealth
Environmental Water Holder acting on its behalf.
The two main government programs operating during the Millennium Drought were
Restoring the Balance in the Murray (the water buy-back) and Sustainable Rural
Water Use and Infrastructure (upgrades). The water buyback and infrastructure
upgrade programs were designed to redress the over-allocation of water licenses for
agricultural producers (especially irrigators) and return water to the stressed river
systems. The water buy-back involves the permanent purchase of water licenses


from agricultural producers, which are then used environmental purposes (Robinson,
2010). This program particularly affected NSW, with 72% of all water licenses sold
coming from that state (NWC, 2009). The infrastructure program is meant to promote
both efficiency and sustainability (Harwood, 2010; MDBA, 2009). It aims to assist
the rural sector to adapt to water security by improving the efficiency and productivity
of water use (Robinson, 2010). The upgrade program is essentially another way of
buying water since the Commonwealth government invests in irrigation infrastructure
in exchange for some, or all of the water savings, which are then used for
environmental purposes (Productivity Commission, 2009).
Social justice
Social justice as described by social psychologists is a type of justice that looks at
the allocation of benefits, like bargaining power, resources or fundamental rights and
duties, in a society (Prilleltensky and Nelson, 1997). The two most researched
components of social justice include distributive justice, which deals with how
resources are distributed in a group (Kymlicka, 2002); and procedural justice, which
focuses on the decision-making processes (Wendorf et al., 2002). The distributive
and procedural components of social justice have been used previously to analyse
fairness and justice of water management (Baldwin and Ross, 2012; Gross, 2011;
Howard, 2010; Syme et al., 2000; Syme et al., 1999). More recent work by
Lukasiewicz et al. (2013a; 2013b) developed a Social Justice Framework to
comprehensively identify and describe social justice principles evident in the MDB
water reform during the Millennium Drought. While this framework has three
components of distributive, procedural and interactive justice, which analyse the
resource distribution; decision-making processes and interactions between decision-
makers and stakeholders respectively, this paper focuses solely on an exploration of
the distributive justice principles.
Deciding what is fair is complicated since evaluations of justice are subjective and
tied to underlying beliefs, morals and values (Beierle and Konisky, 2000; Peterson,
1994; Rasinski, 1987). Social justice thus lies in the eyes of the beholder, meaning
that an assessment of what is fair or unfair can change overtime within a society or
significantly differ between societies and cultures (see Finkel, Harr, & Rodriguez
Lopez, 2001 for an example). Furthermore justice evaluations will be affected by the
scope of factors included, such as the timeline being considered, the scale at which
an evaluation is made and the subject of the evaluation. A common example of how
different timelines can affect justice evaluations is the debate over the rights of
present generations over future ones. In this case the timeline is extended into the
future. However the timeline can also be extended into the past; for instance when
evaluating the justice of actions towards Indigenous peoples. Similarly, the scale at
which justice evaluations are made is important as actions deemed fair at a national,
or industry scale can be deemed unfair at a local level (Patrick, 2014). Indeed this
has been the case with evaluations of the water buyback during the Millennium


Drought, with government reports estimating the impacts of buying water from
irrigators at a Basin-level, industry-wide scale judged them to be relatively low
(NWC, 2010). However evaluations at this scale masked the significant impacts at a
local level in a number of locations (Commonwealth of Australia, 2011). Justice
evaluations are also dependent on who is the subject of justice (Sikor, 2013). An
action that achieves justice for one group may leave another group worse off or
unaffected. These considerations depend on how the evaluator decides their moral
community (Wenzel, 2004), i.e. those to whom justice is owed. A famous argument
is provided by Stone (2010) who pondered what would happen if trees were given
legal standing (and therefore be owed justice) the same as humans.
Different distributive principles can be followed in any decision (see Table 1) and
while none is inherently fairer than any other, they are not all entirely compatible.
Equity is one of the oldest justice criteria, the definition of which remains elusive. All
of its definitions imply some sort of proportionality that the reward is proportional to
input, contribution or deservedness (Deutsch, 1975; Diekmann, et al., 1997; Nadler,
1999; Syme, et al., 1999). Distribution based on need refers to the minimum
requirement necessary for survival (Harding, 1998). Efficiency can be described as
distribution that produces the most gains in production or consumer satisfaction
without imposing losses (Whitley et al., 2008). Implementation of efficiency was
meant to be achieved through efficient water markets that will reveal the value of
water to existing and potential users, and create incentives for users to seek
improved technical productivity, innovate and improve water use efficiency (ACCC,
2009; Robinson, 2009). Distribution based on any one of these principles will thus
benefit different sets of stakeholders; be they the most deserving, efficient or needy.
Therefore following one or more of these principles is going to have justice
consequences, especially if stakeholders evaluate decisions using a different


Table 1. Definitions and empirical examples of three distributive justice principles
Principle How it has been operationalized in water reform
Equity Recognition of prior users rights (water entitlements)
Recognition of the investments made (such as the development of
towns around irrigation enterprises)
Need Basic needs (examples include critical human needs, quantification
of water needs for environment, stock & domestic provisions)
Efficiency Economic: Directing distribution to most productive (i.e. highest
value) use through the water market.
Technical: Favouring systems that dont waste or over-use water
Source: based on Lukasiewicz et al. (2013a)
Research Method
This paper is a continuation of work done by Lukasiewicz et al. (2013a), who
analysed ongoing water reform from a social justice perspective. The original
research applied a justice framework (developed by the authors through compiling
justice principles from existing literature) to an actual policy process to establish the
social justice principles which guided water reform.
This paper builds on the original research by exploring the consequences of
implementing competing principles of distributive justice on three different subjects of
a justice evaluation: the environment, floodplain landholders, and floodplain
Aboriginal communities. Data used for this paper comes from a larger study, on
which the orignal research of Lukasiewicz et al. (2013a;b;c) is based. The original
study used a content analysis of key water reform documents and semi-structured
interviews about water reform with government and non-government respondents. It
has been supplemented with updated references from the web to clarify the current
Content analysis
The eight key water reform policy and legislative documents used in the content
analysis were written in the period 1994-2008. These eight documents (see Table 2)
were key policies or legislation in water reform at a Commonwealth, interstate or
state level which set a new legislative or policy direction for water reform or were a
major announcement of funding or government strategy. The original research was
based on two case studies in NSW and SA and the water legislation of both these
states was included in the selection of documents.


Table 2. Details of documents used in the Content Analysis
Full name Acronym Level Year Importance
The Council of Australian Governments
Water Reform Framework
COAG Interstate 1994
The first document that specifically
addressed the need for water reform
The Intergovernmental Agreement on a
National Water Initiative
NWI Interstate 2004
Still acknowledged as the blueprint for
Australian water reform
The Agreement on Murray-Darling
Basin Reform
MDBA Interstate 2008
Establishes the MDBA and Basin Plan, a
very significant change
Water Act WA Commonwealth 2007 The Commonwealth Water Act
National Plan for Water Security NPWS Commonwealth 2007
Groundbreaking national government policy,
establishing the Murray-Darling Basin
Water for the Future WftF Commonwealth 2009
The current governments water policy,
continuing many themes of the previous
policy but emphasising new directions
Water Management Act NSW WMA State 2000 The NSW Water Act
Natural Resource Management Act SA NRM State 2004 The SA Water Act
Source: based on Lukasiewicz et al. (2013a)


All eight documents were coded using NVivo and categorised into analysis nodes
based on the social justice framework. As each document was read, passages which
included specific justice concepts were identified either through assigned keywords
or implicit meaning and coded into nodes relating to that concept. The results were
numerically listed in three categories, relating to the framework.
Numerous justice principles were identified in this process and it became necessary
to assign weighting to them (see Stemler, 2001) as analysing principles simply on
the frequency of a principle may either underestimate or overestimate its importance.
In this case, the weighting was derived empirically by counting how many times a
principle appears in the objectives section of a document. Each identified principle
thus had a frequency score (referring to the number of times it appeared within a
document) and a weighting score (referring to how many times it appeared as an
objective of the document). Multiplied together they revealed the importance of a
particular justice principle relative to other principles in the document and gave each
justice principle a numerical score that allowed a comparison of principles within an
individual document and across different documents. This multiplication is referred to
as a Relative Importance Score (RI Score) and used in Figure 1 to establish the
dominant distributive justice principles.
Semi-structured interviews
This paper also relies on extracts of interviews conducted with 36 government and
non-government water stakeholders (see Table 3), from 2008 to 2010 (see
Lukasiewicz et al., 2013b; 2013c).
The Commonwealth and NSW government interviewees were senior government
officials with long-term positions of responsibility in water management. The
Lowbidgee landholders were people who are recognised as spokespeople for the
Lowbidgee floodplain while the Aboriginal respondents were elders from groups
whose traditional lands includes the Lowbidgee floodplain. All interviewees were
assured of confidentiality and anonymity and thus quotes used in this paper are
attributed to broad interviewee categories such as Commonwealth government
official or inter-state agency (indicating a member of the Murray-Darling Basin
Commission, Authority or the National Water Commission).


Table 3. Groups of interviewee respondents
Respondent Group Number
Commonwealth government
Inter-state agency
NSW Government 8
Local government 2
Lowbidgee Landholders 7
Aboriginal Respondents 8

Source: derived from Lukasiewicz et al. (2013b; 2013c)
An initial scoping study of the Lowbidgee was conducted in July 2008 when contact
was made with several landholders. The interviews were in 2008-2009, at the height
of the Millennium Drought.
Respondents were phoned or emailed and asked to participate in interviews. They
then suggested other landholders. Most of the Aboriginal elders were approached
through an intermediary, an Aboriginal liaison officer working for a government
agency who had a good working relationship with the elders. The interviews lasted
between thirty minutes and three hours, with the average interview lasting around
one hour. Each interview began with a review of the consent form and an
explanation of the respondents rights and the authors responsibilities. All
respondents quoted in this paper gave initial permission for their quotes to be used
in subsequent publications.
The software package NVivo (Version 8) was used. Interview data was initially coded
thematically to match coding from the content analysis. Then new codes were
created to capture themes raised in interviews that did not appear in the content
analysis, mainly explanations around how social justice principles were
implemented, perceptions of these and explanations of what went right and what did
not. The process followed analytic induction (explanation building) which is a form of
pattern building that compares findings against an initial proposition and revises it as
more findings emerge and offer alternative explanations (Gibbs, 2002).
Case study: the Lowbidgee Floodplain
This paper draws on only one of the two original case studies, since it more
comprehensively shows the interaction of the three distributive justice principles.


The Lowbidgee Floodplain covers an area of approximately 347,300 hectares
between the towns of Maude and Balranald (DEWHA, 2008). Regulation of the
Murrumbidgee River has profoundly changed its natural flows over the past 140
years. The landholders on the Lowbidgee have historically fought against upstream
development, setting up the Lower Murrumbidgee Defence League in 1901 to
campaign for the rights of the floodplain, which were threatened by proposals to
divert the river for irrigation (Eastburn, 2002).
Flooding was a regular occurrence in the 1990s but disappeared almost completely
with the onset of the Millennium Drought which broke in October 2010. However,
both the Commonwealth and NSW governments have made environmental water
available to the Lowbidgee for envrionemtnal purposes during the Drought, as it is
listed as a Wetland of National Significance (Robinson, 2010).
The Lowbidgee has two distinct agricultural and ecosystems, Nimmie-Caira and
Redbank. Most of Redbank has been a National Park since 2005, so this analysis
focuses on the Nimmie-Caira part of the Lowbidgee. Nimmie-Caira used to be
primarily a grazing area but cropping has become dominant in the late 1990s
(Murrumbidgee CMA, 2008). Cropping in Nimmie-Caira is done through ponding, a
unique method whereby the land is flooded in spring in order to sow winter crops the
following year. This method seals moisture in the soil; prevents weed infestation and
evaporation and means that the crop does not rely on rainfall. Ponding is dependent
on overbank flooding and allowed the Lowbidgee to become the largest Australian
producer of organic wheat (Murrumbidgee CMA, 2008). The landholders on the
Floodplain have built banks and levies to hold floodwaters and had a unique
arrangement with the NSW water provider where they paid annual water rates
based on the hectares of arable land, rather than volume of water (amounting to
AU$40,000 and AU$50,000 per year for two of the croppers; pers. comm. 12
November 2009). These arrangements existed despite the fact that the landholders
never owned any type of water licences. While this arrangement was beneficial in
the decades prior to the Millennium Drought, during the drought landholders found
themselves paying large amounts of money annually without water being delivered
to them and therefore, without the ability to plant crops.
The Lowbidgee Floodplain is subject to the Murrumbidgee Water Sharing, however
due to the uniqueness of its arrangements, the Lowbidgee landholders were not
included in the Murrumbidgee Water Sharing Plan that was negotiated before the
Drought and finalised in 2003 (Bowmer, 2007). The landholders campaigned for a
supplementary license throughout the Drought, which was finally granted in 2012
and existing arrangements. However this supplementary license was then sold to the
government through the water buyback program in 2013, effectively ending cropping
activities on the floodplain.


Results and discussion
The content analysis of key water reform documents demonstrates that distribution
according to need emerges as the overwhelming principle of distributive justice,
followed by efficiency and, to a much lesser extent, equity (the principles of equality
and fairness are relatively minor and will not be discussed in this paper). Given that
need is the most important distributive justice principle, whose needs are recognised
and catered for? The embedded table in Figure 1 shows the percentage breakdown
of the Relative Importance Score for need. It identifies the types of needs that were
specified in policy and legislative documents. Overall, 74% of the RI Score for the
need principle referred to needs of the environment, indicating that in distributing
water according to need, the environment is to be prioritised. Other needs were
categorised into economic and social and each constitute 13% of the RI Score for

Figure 1. Content analysis results for distributive justice principles in water reform. Source:
Adapted from Lukasiewicz et al. (2013a)
The Environment
The environment is thus recognised as a legitimate water stakeholder, whose needs
must be met as determined by science. This recognition of environmental needs had
clear, positive benefits for the environment, with the Commonwealth Environmental
Water Holder managing 1,719,470 mega litres worth of water licenses


(Commonwealth of Australia, 2014), most of which has been bought back during the
Millennium Drought.
Prioritisation of need as a principle of distribution meant that the needs of different
stakeholders had to be assessed. This clearly benefited the environment in the early
years of the Drought when the extent of environmental degradation was realised
(Bowmer, 2003). However, as the Millennium Drought continued, town water
supplies in the southern MDB were threatened by unprecedented low dam levels
and the need to secure water supply for urban centres partially replaced concerns
over environmental needs (Craik & Cleaver, 2008). As a result, in December 2008,
the 2007 Water Act was amended to prioritise critical human needs over the
environment. The progression of the Drought thus dictated a change in the
prioritisation of needs and political will to act on behalf of the environment faltered.
Satisfying environmental need is in itself problematic because the environment is not
an easily identifiable entity; how much water does the environment need is a
question dependent on what the environment is and who decides its identity
(Lukasiewicz et al., 2013c). While currently the Basin Plan specifies a Sustainable
Diversion Limit of 10,873 giga litres per year (MDBA, 2014), which is the amount of
water that can be taken out of the river system for consumptive uses (such as
agriculture, town water supply or industry needs); determining this level has not been
without controversy as industry, environmental and community interests bitterly
fought for years over what the amount should be (Commonwealth of Australia,
2011). Tying the use of water for the environment to science also means that it is
held up to higher scrutiny by other stakeholders: The environment always has to
justify every single drop of water it uses . . . how are you going to use it, what are
the objectives? . . . whereas the same hurdles arent placed on the irrigators (Inter-
state agency official).
The fact that the environment is now a water stakeholder whose needs are
recognised and prioritised has been highlighted by Commonwealth government
water managers: were playing on the same field, rather than being at the end of the
queue (Commonwealth government official). Recognition of environmental needs
has been legally framed so that the environment has equal standing
(Commonwealth government official) to consumptive water users. However, making
the environment an equal stakeholder is that it is not a special stakeholder. As an
equal stakeholder, the environment has to get water through the same processes
(the water market), and be subject to the same constraints, as other water users.
This is where the consequences of efficiency as a distributive principle are evident:
since the environment is not a productive producer, its ability to obtain water hinges
on government funding. During and immediately after the Drought, governments
have been committing money to purchase water for the environment, but this could
change. Floodplain landholders have expressed concern for the future of their
environment in the water market Theyve got this mantra: water efficiency, you


know, water for the best use. Well the best economic use at the moment is not on
flood plains, its not in the environment. If future government commitment to
financially secure water for the environment wanes, the environment may not be in a
position to obtain enough water for its needs.
Equity has been operationalised through recognising and protecting existing water
licenses and the way they operate (Robinson, 2010). Water licenses have certain
provisions and these provisions cannot be changed, even if the license is bought by
a different stakeholder. So in NSW, an irrigation license cannot be used for overbank
flooding. However, when bought to satisfy environmental needs, the most efficient
way to do that would be to create a small flood by spilling the water over the bank
(pers. comm. 13 July 2012) Existing rules thus prevent environmental proxies to use
irrigation water in ways that would be most beneficial for environmental needs.
The concurrent implementation of need, efficiency and equity has mostly been
beneficial to the environment as a water stakeholder since its needs were
recognised and prioritised over the needs of irrigation. However, three
consequences have emerged from this analysis. First, need as a distributive
principle does not guarantee that the environment will always be prioritised as
circumstances change and other stakeholders needs may be judged as being more
urgent. Second, determining environmental needs is contested and has been based
on scientific understanding, which places stringent standards on water use for the
environment, potentially constraining management actions. Finally, making the
environment an equal stakeholder in water distribution makes it dependant on
government commitment, which has been strong during the Drought but is uncertain
into the future. This is compounded by the efficiency principle, where the water
market channels water to the most economically productive use, which is difficult for
the environment to demonstrate. The equity principle, operationalised through the
water licensing system, also constrains the use of water licenses to achieve best
environmental outcomes.
Croppers of the Lowbidgee Floodplain
The operationalization of equity and efficiency during the Drought entrenched
existing distribution of wealth in NSW. The two main types of water licences in NSW
are high security (where seasonal allocation is almost always guaranteed) and low
security (where seasonal allocation is dependent on water availability and given after
high security license holders are catered to). The holders of high security water
licenses tend to grow more financially profitable crops, with greater capital
investments and arguably greater risks, whereas holders of low security licenses
tend to grow annual crops which require little upfront investment, and bring in less
financial profit.
The NSW government chose to protect high security license holders more than low
security ones out of equity concerns their contributions to the industry and their


local communities were judged to be more deserving: The political decision has
been taken that we didnt want permanent plantings to die because that would be
basically a serious blow to most of the rural economies . . . Whereas we havent
really been seeking to protect annual cropping to that extent (NSW government
respondent). Thus, while all types of agricultural producers faced hardship during the
Millennium Drought to some extent, the recognition of licenses combined with
formation of water markets meant that high security license holders benefitted more
than low security license holders who benefitted more than those without any
As the Lowbidgee croppers did not hold water licenses, the continuing Millennium
Drought put them in a relatively more precarious position since they faced the same
pressures as their upstream irrigator counterparts, but without the benefit of water
licenses: Well I have no sympathy for them [license holders], whatsoever, because
they have assets to sell (Lowbidgee Landholder). The historical use allocation
meant that existing licenses were recognised, new licenses were harder to obtain.
The implementation of the efficiency principle through the water markets also denied
water to the Lowbidgee landholders. First, one must have a license to trade and
second, due to the way the ponding system worked, the large amount of water
needed to be bought and then delivered to the Lowbidgee system made participation
in the water market financially prohibitive.
The final decision by the NSW government of granting a special type of
supplementary license to the landholders in 2012 and then buying it from them
(Coutts, 2012) to provide environmental flows thus met the distributive goals of
ensuring environmental needs and equity while allowing the market to distribute
water to its highest value use (since the government was willing to pay for the water).
Significant environmental gains were achieved and the landholders history of use
was recognised (belatedly) through the granting of licenses which then were able to
be sold through the water market. However, the way that equity and efficiency were
implemented in NSW, put the Lowbidgee croppers at a disadvantage with their
irrigator counterparts during the financially difficult period of the Millennium Drought
and majority of them have ceased farming (pers. comm. 28 June 2014).
Aboriginal floodplain communities
The environment is not the only recently recognised water stakeholder. The NWI
emphasised the involvement of Aboriginal peoples in water management and
recognised their social and cultural needs (see Figure 1; COAG, 2004). Also, NSW
water sharing plans are obliged to include consideration of the spiritual, social,
customary and economic values of water to Aboriginal people as well as Native Title
rights relating to water (NOW, 2014).


However, the satisfaction of the broad range of Aboriginal needs cannot be fulfilled
through water reform alone. One of the biggest obstacles that some NSW Aboriginal
elders identified during interviews is lack of physical access to water resources
caused by landholders fencing off their lands: Well the biggest justice issue for
aboriginal people is that they dont have access to water (Aboriginal elder). Not
being allowed to walk on country means that the elders cannot pass on their
knowledge to younger generations, hunt and fish to obtain healthy food sources or
visit important sites. This issue is not addressed by reform documents like the NWI
and Commonwealth and state governments are constrained by laws protecting
private property to act on behalf of Aboriginal communities.
The implementation of equity as recognition of historical use focuses on recognising
existing water users through the licensing system. Few Aboriginal groups or
individuals owned water licenses prior to the Millennium Drought, which made it hard
for them, as newly recognised stakeholders, to gain water licenses during a period
dominated by water shortages and a continuing fight against over-allocation. The
amended NSW Water Management Act does allow special water licenses for
Aboriginal cultural flows (see Weir, 2010 for an explanation) or commercial purposes
(Jackson, 2009). However the utilisation of this legislative provision has been limited.
At the time of data gathering (2008-2010) the only Aboriginal cultural access licence
that was granted in NSW went to the Nari-Nari Tribal Council near Hay in 2005 to
water a culturally significant wetland to restore fish life (Jackson, 2009).
The implementation of efficiency through the water markets also did little to benefit
Aboriginal communities as stakeholders. Theoretically, Aboriginal communities are
able to buy water as anyone else is. However, as a group that has been historically
disposed of land and resources in the MDB, most Aboriginal communities lack
financial capital to compete in the market or to establish efficient and productive
irrigation enterprises. For example this has been the reason cited by Jackson (2009)
as to why none of the commercial water licenses for Aboriginal people have been
utilised to date. In the interviews conducted with Aboriginal elders during 2008-2010,
none mentioned any type of involvement with water-dependent economic production.
The lack of financial resources has been acknowledged by the NSW government to
some extent, as it decreed that applicants for cultural access licences are exempt
from the standards application fees (Jackson, 2009). The recent Aboriginal Water
Initiative set up by the NSW Office of Water to monitor how NSW water sharing
plans are meeting their statutory requirements in incorporating Aboriginal water
needs (NOW, 2014) is another indication that Aboriginal water needs are a)
recognised, and b) unfulfilled.
Need as a principle of water distribution thus enabled the recognition and
consideration of Aboriginal communities as a water stakeholder, through legislative
provisions and the granting of special licenses for cultural and commercial purposes.
However the historical dispossession of Aboriginal peoples, leading to lack of access


to land and other financial resources means that Aboriginal communities are
generally locked out of a system that, protects established water users and
prioritises productive enterprises for which Aboriginal communities lack the start-up
capital to engage in.
This paper explored how the implementation of three prominent distributive justice
principles affected different stakeholders during water reforms in the MDB through
the period of the Millennium Drought. The purpose of this exploration is not to
determine which principle is fairest but to show how the interaction of all three led to
different justice consequences for different stakeholders at different times and at
different scales. While the introduction of water markets and recognition of existing
users have been favourably judged at the Basin scale and is thought to have set up
positive changes for the long-term future of agriculture in the Basin, the reforms did
so largely by protecting those who already benefitted from (and therefore contributed
to) the agricultural system (irrigators more than croppers). This distribution was
balanced by the expressed recognition of basic needs for previously excluded
stakeholders (like the environment and Aboriginal peoples). While the recognition of
their needs potentially puts these stakeholders in better stead for the future, the
implementation of efficiency and equity provides little means for these stakeholders
to compete on equal terms with established water stakeholders.
Ultimately, the readers must decide whether water reform has been fair (and to
whom). Such a decision will depend on what kind of an environment and what kind
of agriculture Australians want in the MDB and to what extent certain vulnerable
stakeholder groups should be protected from inevitable changes.
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Integrated Assessment and Decision-Support Tool for Community-
based Vulnerability and Adaptation to Storm Surges in Four
Coastal Areas in Bangladesh
Md Aboul Fazal Younus
, Sabrina Shahrin Sharna
, Tamanna Binte Rahman

School of Social Sciences, University of Adelaide, Australia
Department of Mathematics and Natural Sciences, BRAC University, Dhaka,
Department of Urban and Regional Planning, University of Hawaii at Manoa,
Honolulu, HI-96848, USA
Bangladesh has been identified as one of the countries most vulnerable to climate
change and rising sea-level. This is because it is located at the northern end of the
funnel-shaped Bay of Bengal, and as a consequence it has experienced a number of
severe storm surges in the last three decades. The inhabitants of the coastal region
are very poor, and the surges have pushed them to a tipping-point; that is, the point
of desperation which is exacerbating the socio-economic threats to their existence.
The study reported here aimed to explore the perceptions of coastal communities
with regard to vulnerability and adaptation (V & A) strategies in four different areas of
Bangladesh in order to reduce their vulnerability to future storm surges. After
reviewing the impact assessment guidelines of the Intergovernmental Panel on
Climate Change (IPCC), United States Country Studies Program (USCSP) and
United Nations Environment Programme (UNEP), the researchers applied the
Participatory Rapid Appraisal (PRA) method (a behavioural environmental decision-
making tool) to survey 160 participants in four case-study areas,with 20 participants
in two sessions in each case. The evaluation of V & A was implemented and
prioritised in this study by a measuring scale, called the weighted matrix index. This
study not only considered the integrated assessment of V & A but it also classified
the levels of vulnerability and adaptation in different categories. Additionally, it
provides a comparative picture of the vulnerabilities for similar risks in different types
of communities. The study emphasizes some key aspects: a. the composite nature
of various levels of V & A issues; b. the constraints to adaptation implementation; c.
how to overcome those constraints. These key aspects demonstrate and stress that
adaptation policy needs to be implemented immediately in Bangladesh in order to
reduce and manage future vulnerability in the coastal region of Bangladesh under
the potential climate change regimes.


Bangladesh, Cyclones, Storms, Impact Guidelines, Vulnerability, Adaptation, PRA,
Weighted Index, Adaptation Limits/Constraints, Climate Change.
According to the Intergovernmental Panel on Climate Change (IPCC, 2014, 2007),
United States Agency for International Development (USAID) (2007), and other
coastal authorities in the Asia-Pacific region (Harvey, 2006; Warrick and Ahmad,
1996; Broadus, 1993), the coastal areas of Bangladesh face heightened risk from
cyclones, storm surges, and coastal flooding as a result of continued global
warming. Scientists have argued that all societies are fundamentally adaptive to
vulnerabilities which they face repeatedly (Adger et al., 2003). The coastal
inhabitants of Bangladesh are highly adaptive (Younus et al., 2012-13; Saroar and
Routary, 2009), though due to the absence of adaptation planning, poor
infrastructure, inadequate communication networks, poor transport modes, poverty,
and a general lack of awareness of warning signals, the consequences of coastal
flooding are serious and deadly for this region. The economic consequences of failed
adaptation in response with flooding are large (Younus and Harvey, 2014).
Bangladeshs low-lying coastal zone covers 47,201 km and is occupied by 38
million people. The region is divided into 19 administrative districts encompassing
147 upazilas: of these, 48 upazilas are exposed to the coast and 99 upazilas lie in
the coastal interior.
The GDP of Bangladesh in 2012 was 115.6 billion USD, and the GDP per capita was
597.49 USD (Trading Economics, 2014). Another study (Younus and Harvey, 2014;
Younus, 2014) reported that the failed effect of adaptation (to crop, houses and
plants) due to extreme flood in 1998 was large, i.e. US$ 14 billion, which is nearly 75
percent of the agricultural sectors contribution to GDP. The potential damage bill
from a 10 year return- period cyclone in a changing climate has been estimated at
US$ 2.44 billion, but a further US$2.12 billion could be added for potential losses by
the year 2050 (WB, 2010). Though there is no available data on estimates of the
cost of reducing vulnerabilities in Bangladesh, the above information indicate that
the failed effects of adaptation due to extreme floods, as an example, and the
potential damage bill of cyclones both are large. Due to the poor state of the
economy (as per countrys total GDP and the GDP per capita), the Government is
unable to reduce the vulnerability of the coastal communities, although through long
experience the inhabitants have developed wide knowledge of how to cope with
these calamities through using local resources and inherited knowledge. But despite
their ingenuity and experience these coping procedures are not enough to enable
them to survive relentless assaults on their land and homes; hence the regions
vulnerability and adaptation (V & A) factors need to be identified. At the same time
the limiting factors (that is, the barriers to adaptation) need to be better understood

as do the methods for overcoming those barriers. So far, no studies have addressed
these issues.
In this work the authors had two key objectives:
(1) To categorize the common vulnerability and adaptation issues through a
weighting index scale from four case-study areas in the context of recent
storm surges caused by cyclones in order to understand various intensity
levels of V & A in coastal region of Bangladesh.
(2) To identify the integrated common urgent adaptation issues and the
adaptation constraints/limits; to determine the factors for overcoming those
constraints at the community level in the case study areas in order to ensure
sustainable adaptations to cyclones and storms.
Younus et al. (2012-13) emphasized the importance of prioritising vulnerability and
adaptation issues at the community level, and by addressing these urgent V & A
issues the regions development and sustainability can be ensured. This paper
focuses on the combined and common vulnerability and adaptation issues that exist
in four coastal regions in Bangladesh. With regard to these integrated issues the
authors argue that vulnerability and adaptation factors, identified as priorities by this
research, need to be addressed immediately in order to reduce the vulnerability of
the communities to future climate change regimes. Moreover, this paper focuses on
the constraints to adaptations, and how to overcome those constraints: in short, how
to get things done so that people can more effectively adapt to severe events. This
study is a model for the future allocation of adaptation funds at the community-level
in Bangladesh.
Participatory Rapid Appraisal (PRA) sessions have been conducted in four coastal
zones in 2013. Four different communities were selected from the coastal districts of
Bangladesh, and these represent four coastal zones from four Districts (Map 1). The
four districts represent the scenario of the total coastal belt because they include the
south western district (Khulna), south central districts (Pirojpur and Borguna) and the
south eastern district (Coxs Bazar). It is noted that during the last 125 years from
1991 (cyclone Gorkey) 40 cyclones ravaged the coastal area; specifically, six
cyclones struck the Bangladesh coast during 1970 to 2009. 300,000 people died due
to cyclone Bhola in 1971.
A Participatory Rural Appraisal (PRA) method was adopted, having been applied
successfully in a previous study by Younus and Harvey (Younus et al., 2012-13;
Younus and Harvey, 2013). The PRA method has been used widely in other studies
and has been shown to be methodologically sound for use in developing countries
(Theis & Grady, 1991; Chambers, 2002). The PRA method is a participatory

research method where participants could describe the local vulnerability and
adaptation aspects/issues. These issues have then been weighted through a 1-20
weighting scale. In this session, one participant, for example, identified one
vulnerability issue; this issue has to be recognised and accepted by all the
participants. This issue, when accepted, is weighted and agreed by all the
participants. If any participant gives wrong information to the audience the other
participants would refute it. The collective information was validated though this
The PRA method has several advantages and disadvantages. The advantages are:
it provides substantial information within a short period of time; it can work effectively
in illiterate societies and remote places where questionnaire survey is difficult to
organise and time consuming; the information can easily be weighted, and intensity
of vulnerability can easily be ranked; qualitative information can be transformed into
quantitative data; it represents local knowledge, enables local people to make their
own appraisal, analysis and plan; it is a bottom-up research approach which
transforms local information to national policy information; it enables a consensus
statement of the local peoples opinion on the issue; it ensures local peoples
participation in the disaster management plan; it provides a basket of techniques
from which those most appropriate to the project context can be selected; it is cost
effective. Two different PRA sessions were conducted for each union from four
different districts. To assess vulnerability for this study, a weighted matrix index
value (Baker & Rapaport, 2005; Ying & Liu, 1995; Glasson et al., 2005) was
measured. V & A issues within each zone were identified based on the PRA which
contained results of two cyclones. These two results were combined and an agreed
weighted index value was generated.
Eight PRA sessions were conducted in four case study areas. Sixty eight
vulnerability issues were identified, and participants were asked to come up with a
number from 1-20, where 20 signifies highest vulnerability and 1 represents lowest
vulnerability. It was also explained to them that the values are again ranked into four
categories, very high (16-20), high (11-15), low (6-10) and very low (1-5). The
participants discussed between themselves and agreed on one number for each
vulnerability issue. Thus eight values were obtained for each of those issues.
Composite indexes of those values were obtained, giving the final ranking for that
particular issue. For example, on the issue of saline and sand deposition on
agricultural land, three out of four rankings were high vulnerability and the remainder
were low vulnerability. Subsequently this issue was ranked high according to
majority consensus. This means saline and sand deposition was ranked as a high
vulnerability issue for the whole case study area.


Adaptation issues were identified based on the respondents perceptions,
vulnerability experiences, needs and priorities based on pre-cyclone and post-
cyclone scenarios. In accordance with the priority of needs, the adaptation
assessment measurement scale was divided into four categories with equal interval
i.e. 160-140: Urgent; 140-120: Intermediate; 120-100: Low; 100-80: Very Low. We
excluded the issues with integrated weighted index values below 80, because of
their very low frequency. Before the PRA sessions, pilot surveys were done for each
study area and a semi structured questionnaire was formed which contained a
checklist of vulnerability and adaptation issues. The issues of vulnerability (68) and
adaptation (71) of the four case study areas (two PRA sessions in each case study
area) were identified through these pilot surveys. Some case study areas had slightly
higher numbers of issues than the issues mentioned in this paper but as these
issues were of low weighted value according to the respondents, these have been
omitted from the composite index.
The participants of PRA were chosen on the basis of Judgement Sampling which is
one kind of non-probability sampling. Participants were selected who are considered
to be most representative of the population as a whole. The men and women who
took part in this study were recruited by personal contact. Information from recent
major cyclones Sidr (in 2007) and Aila (in 2009) were obtained with reference to their
effects on the case-study zones of Barguna, Pirojpur, and Khulna. Cyclone Aila did
not strike Chittagong and so cyclone Gorkey (in 1991) and cyclone Sidr were taken
as case-studies for that zone. Of the survey participants, 23 percent were farmers
(both male and female) who owned their land and had extensive experience of
farming; 26 percent of participants were fishers. The other half of the attendees
comprised representatives of professional and community groups, and they included
business people, service holders, community leaders, religious leaders, students,
teachers, carpenters, day labourers, and rickshaw pullers. About 25 percent were
female and almost 70 percent of the respondents were illiterate.
Climate-change impact assessment guidelines (IPCC: Carter et al., 1994: USCSP:
Benioff et al., 1996: and UNEP & IES, 1996) were reviewed and seven
steps/procedures were adopted. The steps are: step 1. Identification of V & A issues
through PRA; 2. Cyclones and storm surges act as environmental barriers or
constraints; 3. Adaptation options and limits were defined; steps 4. & 5: quantifying,
classifying and identifying common V & A issues; 6. Developing a weighted value
index; 7. The priorities and essentials of common V & A measures (including the
limiting and overcoming factors for adaptation) are recommended in the light of
climate change context.
The above adopted steps are mostly similar to other impact assessment guidelines
but the manner of impact assessment of common vulnerability and adaptation issues
in the coastal region has substantially differed from conventional (IPCC, USCSP and
UNEP) guidelines. Firstly, in this study, unlike other assessment methods, the

identification of common vulnerability and adaptation issues was done through PRA
followed by use of the weighting value index scale. Younus and Harvey (2013)
discussed in detail the differences between the guidelines (IPCC, USCSP and
UNEP) and micro-level bottom up assessment of V & A. Cyclones and storm surges
have been considered here as environmental barriers and constraints; different
levels of intensity of V & A (e.g. high, medium, low and very low) at case study level
have been quantified and classified through the weighting value (WV) index. The
levels were derived through local participants consensus responses in a practical
way. The evaluation of alternative adaptation strategies (how to overcome the
barriers of current execution of adaptations) have also been indicated through this
micro-level impact assessment in the present study the alternative adaptation
steps are shown in a different way which have not been prescribed in other
guidelines. This study has shown a significant direction through which the local level
climatic impact needs to be addressed. In addition, it shows how to identify common
alternative adaptation options through local peoples participation and consensus
which may yield important findings of the local levels climatic shift. These local level
findings could depict a range of interventions that are needed under the climate
change regimes.
Results and discussion
Assessment of Vulnerability
Table 1 shows that the respondents in Coxs Bazar indicated 47 vulnerable issues
which ranked as high and which need urgent consideration for disaster
management. Respondents in Barguna identified 42 high-vulnerability issues;
respondents in Khulna identified 32 high-vulnerability issues, and the respondents in
Pirojpur identified nine high-vulnerability issues for their area. This confirms that
Coxs Bazar and Barguna were repeatedly struck by major cyclones (magnitude >6)
whereas Pirojpur is located in a safer location than other coastal zones. Table 2
shows some common high vulnerability issues in four coastal districts. This also
demonstrates the livelihood system of the area whereby most of the people directly
or indirectly depend on agricultural production, fish-farming, and fishing. So the loss
of primary occupation is one of the key threats from storm events.
Table 1. Number of Vulnerability Issues in Four Coastal Districts
Category of vulnerability Barguna Pirojpur Khulna Coxs
High vulnerability (HV) (WV: 16-20) 42 09 34 47
Medium vulnerability (MV) ((WV: 11-15) 18 27 29 18
Low Vulnerability (LV) (WV: 6-10) 07 24 03 03
Very low vulnerability (VLV) (WV: 0-5) 01 08 02 00
Total No of Vulnerability Issues 68 68 68 68


Table 2. Common High-Vulnerability Issues in Four Coastal Districts
Primary occupation loss
Pond-fish loss
Culture fish-pond loss
Agricultural input loss (seeds, pesticide, fertilizer)
Labouring cost loss
Land preparation for agricultural production loss
Loss of working season (fishing/cultivation time)
Loss of working efficiency

Assessment of Adaptation of Four Coastal Communities
Using the PRA method, the survey by the authors identified adaptation issues in four
different coastal zones: these issues were based on the participants perceptions,
experiences, needs, and priorities following various pre-cyclone and post-cyclone
scenarios. In addition to the PRA participants, a number of older and more-educated
local people were selected in order to gather more information about past disaster
events and their impacts. About 71 adaptation issues were identified during the PRA
session, these being summarised in Table 3.
Table 3. Number of Adaptation Issues in Four Coastal Districts
Category of Adaptation Issues Integrated Weighted
Value (WV) Index
No of adaptation
issues in four coastal
Common Urgent Adaptation Issues (U) 160-140 14
Common Intermediate Adaptation Issues (I) 140-120 26
Common Low Adaptation Issues (L) 120-100 17
Common Very Low Adaptation Issues (VL) 100-80 14
Total No of Adaptation Issues 71

It can be seen (Table 3) that urgent adaptations require high priority. Of the many
adaptation strategies 14 have been defined as being urgent. Appendix A details the
needs that arise after cyclone disasters. Food relief, supplies of safe drinking water,
shelter construction-material, sanitation material, and the removal of uprooted trees
were accorded urgent priority by all those who were surveyed. They also indicated
the need for a proper damage-assessment system, for the prompt distribution of
relief supplies, and for efficient recovery activities for the people most affected. The
repair or reconstruction of roads, embankments, and communication system were
also said to be urgent priorities. Particular mention was made of livelihood recovery-
activities which can be done through easy access to low-interest loans from banks,
governments, or NGOs. The participants also suggested the establishment of

disaster or climate funds at the local-government level (Union Parishad).The
participants also reported that most of the time they could not understand the
warning system which, it was said, needed to be reviewed.
The sale of land and trees after disasters was a common adaptation strategy in
Barguna, Coxs Bazar, and Khulna. In these zones, the residents often move
temporarily to other town and cities to make a living or to obtain loans, the money
usually being used for fishing or for agricultural activities. This, too, is an adaptive
strategy, and it must be remembered that some areas remain inundated for long
periods, thus preventing farmers from making a living by resuming their usual
agricultural activities. In such instances governments and aid agencies need to
provide relief in the form of food and non-food item until the saline water subsides.
Once the land is available again the farmers still need agricultural inputs (fertilizers,
pesticide, seeds etc). In Coxs Bazar, immediate cash relief is preferred; in Khulna
people sometimes choose to migrate from the area as an adaptation strategy
because many are aware that increasing high tides, long-term inundation, salinity
problems, and a lack of livelihood opportunities are on-going concerns. They also
cited prohibitions against the conversion of agricultural land to shrimp farms as a
constraint to the use of an adaptive measure for recovering from disasters. They also
mentioned restricting the removal of trees and restricting the occupation of forest
land as another urgent adaptive measure which may protect them from the severity
of cyclone damage and a way of restoring biodiversity to the area. Another proposal
was for the formation of village cooperatives; these could assist by strengthening
local adaptations against future disasters, and would be useful in the early stages of
In regard to the construction of low-cost shelters, the elevation of house plinths using
RCC (reinforced concrete column) columns is also an adaptive technique being
adopted in Coxs Bazar and Khulna. In fishing communities in Khulna, Pirojpur, and
Coxs Bazar the raising of the walls of ponds, and securing nets around ponds, were
cited as urgent adaptive strategies. When considering the events in Barguna, Coxs
Bazar and Khulna, the respondents focused on the different varieties of rice which
could be used (such as HYV or saline-tolerant varieties). In Barguna and Pirojpur
they emphasized the value of storm-warning practice drills which could be provided
by local government agencies or by NGOs. Mock drills could be arranged in schools
or colleges so that communities could become better prepared for the steps that
should be taken during disasters and in the immediate aftermath of storms and
Urgent Adaptations
Fourteen issues have been prioritized as urgent adaptations as measured by
integrated weighted index values above 140 (Appendix A).
Common Intermediate Adaptation Issues in Four Case Studies

According to the integrated weighted index values (120-140), 26 issues have been
identified as common intermediate adaptations (Appendix A).
Common Low-Adaptation Issues in Four Case Studies:
Issues with weighted index values of 100-120 were categorised as low adaptation
issues. Seventeen of the 71 issues have been categorised as being low adaptations
(Appendix A).
Common Very Low Adaptation Issues in Four Case Studies
Issues with weighted index value less than 100 were categorised as very low
adaptations. Fourteen issues have been allocated to this category (Appendix A).
Description of Common High Adaptation Issues, Constraints, and Recommendations
Thirteen common high adaptation techniques have been identified from the four case
study areas which subsequently represent the coastal region of Bangladesh though
each locality (e.g. agro-ecological zone or each coastal zone) holds diversified
common vulnerability and adaptation techniques (Table 4). Some major aspects
regarding the studied common adaptation issues have been investigated; these are:
a. why adaptation is needed and what are the justification and benefits of these
common adaptation techniques; b. what are the constraints or barriers of these
adaptation implementations; c. how to overcome these constraints, along with some
recommendations in order to improve sustainable adaptation in response with storm
surges in coastal region of Bangladesh under the probable climate change regimes.
Conclusions and recommendations
This paper has focused on some recent aspects of community-based integrated
vulnerability and adaptation issues in four case-study areas in coastal regions of
Bangladesh. With population densities of about 750 per square kilometre, these
districts are very poor and the economies marginal and vulnerable to weather-related
events. The people may be poor but over time they have proved to be quite
resourceful in the ways they have adapted to severe events. However, those events
seem to be more frequent and more severe so that they capacity of people to adapt,
recover, and readjust are being diminished. The survey reported here considered
some of the issues which influence peoples ability to adapt. Some key aspects of
this survey method are as follows. Firstly, by using the PRA sessions with an
integrated weighing method the common vulnerability and adaptation issues from
four different coastal micro environments have been identified as common
representative factors of coastal regions in Bangladesh.


Table 4. Common High Adaptation Issues, Constrains and Recommendations
Adaptation Techniques Why needed /Justifications / Benefits Adaptation implementation
How to overcome these constraints;
some recommendations
1. Need relief in the form of
2. Need pure drinking water,
water purification tablets,
jerry cans

After severe storm surges, dry foods and
pure drinking water are top priority relief
items. During storm surges stoves become
wet and all the water become saline, so it is
an emergency issue to get pure drinking
water. This zone depends on ponds and
rain water for drinking and cooking
purposes. Residents store rain water in
bottles, jars, and drums. They purify the
pond water with halotab tablets.
Reserve ponds for pure drinking water are
damaged in storm surges. Tube-wells are
not effective sources of drinking water in
this region because 1200-1500ft-deep wells
are also unable to collect fresh drinking
water. Moreover, due to lack of proper
management, most of the tube-wells
become unusable after storm surge. So,
supplies of pure drinking water or halotabs
can be helpful to meet the immediate
1. Inadequate funding and poor
transportation networks are major
constraints to the transporting of
relief supplies to distressed people.
2. Water is heavy and bulky so
most relief agencies avoid
transporting it from distant places.
3. Everyone needs water after
disaster period but the amount they
receive is very limited.
4. Storing rain water requires large
containers which they cannot effort.
5. Lack of information about flood
and storm condition is also a barrier
to relief work.
6. Corruption among management,
field staff, government and non-
government staff, local
representatives, Union Parishad
members, Chairmen, and NGO
workers are some major obstacles
to effective relief work.
1. Maintaining reserve ponds for
disaster periods, the boundaries to
be built at such heights that flood-
water cannot enter.
2. More water purification tablets
should be provided.
3. Big containers (2000-3000 litres)
may be used to store rainwater; they
could be located beside cyclone
shelters or near markets.
4. Trollers (big fishing boat, locally
made) may be used to carry water
over waterways rather than roads.
Local people could obtain pure
drinking water at specified time at
particular locations on river banks
after disasters.
3. Need for temporary Most of the houses in these four regions 1. Insufficient land and funding for 1. Efficient workers should be used


are katcha houses which are vulnerable to
storm surges. To protect the people
temporary shelters are needed. They also
require security of life, valuable goods,
livestock, and important papers. The katcha
and semi packa houses were destroyed
during cyclone Sidr. After Sidr many
cyclone shelters were built in the area but
still insufficient to meet their demand.
The people were not aware of the use of
warning systems prior to Sidr because they
had not faced any major cyclones for many
years. They encountered difficulties moving
to shelters before Sidr struck as they were
unaware of its approach. Insufficient
shelters also increased the suffering of local
people. Now they are more aware of the
warning systems and they leave their
katcha houses when alerted.
making shelters.
2. Corruption among staff of NGOs
and union parishads.3. Obstacles
posed by third parties or agents
between donors and victims.
These inhibit the prompt and timely
provision of all forms of assistance.
4. Site selection for cyclone
shelters is often influenced by local
political leaders. They are biased
and ultimately less vulnerable
because people with good contacts
with political leaders obtain better
and less-vulnerable facilities.
for making houses.2. Equipment
should be adequate and suited to
recovery work and restorations.
3. Selection of locations for cyclone
shelters should be with the consent
of local representatives; this will help
preclude corruption.
4. Need to maintain sluice

Sluice gates are necessary to regulate the
drainage of water. After a severe storm
surge sluice gates need to be operated
properly to maintain the water level, but
most of them are not properly maintained.
As a result rust is found.
Materials used in sluice gate are
not appropriate and so rust and
decay occur quickly. Technical
knowledge about maintaining sluice
gate is inadequate. Regular
maintenance is also lacking.
The Water Development Board
should strictly monitor the conditions
of sluice gate. Directions and
responsibilities for the management
of sluice gates before, during, and
after disasters must be clear and
5. Easy access to
bank/govt/NGO loans with
low interest
To overcome acute conditions after storm
surge people need immediate loans for
recovery. They can obtain loans from local
investors but at high interest. They need
ready access to short-term or long-term
Banks are not providing loans to
local people against any mortgaged
property. Government and NGO-
level cooperation is insufficient to
meet demand. Financial constraints
No interest/ interest-free loans should
be provided by different
NGO/government/non government

loans at low interest (or without interest)
from NGOs, banks, and government
organizations. Such loans can play an
important role in restoring occupations.
Farmers and fishermen are able to use their
loan in other sectors and it provides time to
recover the losses from disasters.
are prominent in that case.
Government is quite unable to
support victims solely at that time.
Funding shortages also apply to
NGOs. After disasters some
NGOs/INGOs providing assistance
but it cannot help some people who
are already in debt to different
It is a general practice for some
people to obtain a loan from one
NGO and using the instalments to
repay another. It is a closed loop.
This practice decreases the mental
spirit of local people and
discourages them from repaying
banks from their own earnings.
They may not be utilizing the loan
money in their business and so
economic stability is not achieved.
Knowledge of the proper use of loans
should be strengthened among local
people so that they can use the funds
more productively. Cooperatives may
be formed for disaster period from
the income generated from loans.
6. Need to reconstruct roads After cyclones Aila and Sidr many katcha
and brick soling roads were damaged.
Immediate relief couldnt arrive where it was
needed because of poor roads and
damaged infrastructure. Both internal and
external markets are affected too. So roads
must be repaired as soon as possible.
Injured people cannot be taken to the
hospitals because of damaged networks,
and some areas remain isolated from the
Katcha, semi-paka, and paka roads
are damaged by storm surges.
Funding shortage is the main
obstacle to repair. Everyone is busy
with theirown problems and cannot
pay attention to road construction
so the roads deteriorate even
Emergency response planning
should establish priorities.
Reconstruction of roads must be a
high priority. Relief work will be
enhanced if the road networks are
maintained. A portion of relief funding
should be applied to the repair of

7. Need to reconstruct
sanitary facilities
Sanitary systems totally fail during extreme
events. Slabs are often broken and latrines
are washed out by water. Inundation of
latrines is a serious problem, and they need
immediate repair. Moreover, the effluent
mixes with canals and ponds and thus
pollutes open waterways. Water becomes
unusable for drinking and cooking
purposes. It can cause various diseases
such as diarrhoea and typhoid.
People are often unaware of the
dangerous effects of water
pollution. The quality of sanitary
latrines supplied by Union Parishad
is very low and they are not located
at suitable heights above flood
levels. Little funding is devoted to
constructing latrines so they are
very vulnerable. Poverty is the main
issue here.
Quality of ring slabs supplied by
Union Parishad should be increased.
Location and quality of construction
of latrines are key issues for all
coastal districts.
8. Allocate budget Integrated planning is needed to reduce
disaster risks in vulnerable coastal areas.
All infrastructure items must take account of
likely storms and surges. Construction of
bridges, roads and sanitary latrines should
be built in ways that they can survive
disasters. It may take more funding to
ensure that structures are disaster-resistant
rather than having to replace items again
after each event. So, governments should
emphasize that there should be full
integration between different departments
when addressing disaster issues.
Governments need to give special
consideration to these areas and allocate
budgets for the works based on each
Annual Development Plan.
1. Lack of coordination among
different sectors of government is
the main problem.
2. Financial barriers are also
Communication gaps between
sectors should be minimized.
9. Need to assess damage
and identify losses
10. Need to make the list of
Each disaster recovery-program involves
damage assessment. If the assessment is
conducted properly the areas of need can
be identified and relief can be distributed
1. Financial and technical barriers.
2. Tendency of people to prove
themselves more vulnerable and
more victims; this is a serious
Experts and trustworthy people
should be involved in assessments.
Biases and nepotism involving
relatives, families and friends should
be avoided. People of one

priority relief. where most needed. obstacle to accurate and fair
3. Information collected and
analyzed is not always correct, so
victims most in need cannot be
identified or located.
4. Powerful communities obtain
advantages while poor communities
are inadequately identified or
community may be assigned to do
the assessment of another area, an
approach which might help eliminate
11. Need to train people
about warning system
Knowledge about warning systems is poor.
Damage from Sidr was more severe than
that of Aila because people were less
aware of the warning system and so
remained at home rather going to the
cyclone shelter. But at time of Aila their
response was different. They followed the
warning and were able to reduce deaths,
injuries and damage.
Local people are reluctant to learn
about warning systems. In some
places people reported having been
misguided by false warning
systems on previous occasions and
so they ceased heeding the alarms.
Social awareness builds-up programs
and may be provided to local people
to encourage them to follow warning
system. Text books for students at all
levels should contain information
about warning system so that new
generations can play a role in
disseminating information about
cyclone warnings. Local religious
leaders may provide accurate
information and can play a great role
in ensuring that people are better
informed about warning system.
12. Need to establish
disaster/climate fund in the
Union Parishad
It is essential to establish a disaster fund in
the Union Parishad for future events. Union
Parishads may work at pre-disaster, during
disasters, and after disasters. If they are
active prior to events then damage will be
reduced. Roads, trees, bridges, link-roads,
and access to cyclone centres may be
1. Unavailability of funds.
2.Lack of coordination in decision
Proper monitoring is a prerequisite
for establishment of such a fund.
Local people should be involved to
protect against corruption of UP

maintained by community funds. Warning
systems and evacuating people after
disasters is also a duty of Union Parishads.
So, if the Union Parishad works throughout
the year it will be a benefit to the community
when a severe event occurs. They will
collect funds from NGOs, INGOs, or from
governments so that they are prepared for
any future emergencies.
13. Need to ensure effective
distribution of relief goods
14. Need to recovery
activities to all of the affected

It is important to distribute relief items and
recovery activities properly otherwise some
people will benefit while others are
Damage to transportation systems
makes it very difficult for citizens to
reach other communities and to
move around. Relief teams might
distribute aid to the people with
better transportation facilities,
failing to provide for those in remote
inaccessible districts.
Transportation networks must be
repaired as a top priority. There must
be integration between all agencies
responsible for distributing relief.

The vulnerability factors have been divided into four categories: high, medium, low
and very low, and the adaptation procedures have been described as urgent,
medium, low, and very low. Secondly, by addressing the urgent adaptation issues,
the main research gaps (that is, the constraints to adaptations at the community
level, how to overcome those constraints, and some recommendations) have been
explored systematically: the details are summarised in Table 4. These
recommendations will help to ensure sustainable adaptations in response to future
weather events under probable climate change regimes and sea level rise in the
coastal regions of Bangladesh.
To reduce community vulnerability and to assist sustainable adaptations to these
natural hazards, international donor agencies and developed countries, together with
the Bangladeshi Government, need to pay more attention to local infrastructure
development and improving other facilities (e.g. communication facilities, local
transport modes, sluice gates, embankments, and multi-purpose cyclone shelters).
Another priority is the installation of modern storm/surge warning technology and the
education of the people in its use. It is important, too, that governments strengthen
the work of local union parishads (for example, their work in relief distribution,
monitoring, and evacuation). It would also be beneficial to train workers in union
agricultural offices in order to improve local cropping patterns and reducing logging
of saline water. Another improvement to aid adaptations would be easy access to
funds which could be used to rebuild houses, re-establish farms and fisheries, and
construct/repair ring-slabs latrines. Funds are also required for improving
communication between local UPs and other local Government agencies, for helping
to form cooperatives among the local communities, and for facilitating unbiased VGF
lists through the UP or the community-based adaptation committee (CBAC) (Younus
& Harvey, 2013; Younus et al., 2012-13). The lists are needed for prioritizing rapid-
response relief and for establishing and providing disaster/climate funding at the
local UP or CBAC. To meet these many needs the Government must urgently
develop effective adaptation policies in anticipation of climate change and sea-level
rise, because in the future the main focus will be on strengthening local UPs and
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Appendix A: Common Adaptation Issues in Four Case Studies and ranking

No. Common Urgent Adaptation Issues in Four Case Studies
(Integrated WI Value 160-140)
Integrated WI Value
(Total 160)
1 Need to calculate the damage 160
2 Need to ensure effective distribution of recovery activities to all of the affected area 158
3 Need to ensure effective distribution of relief goods to the all of the affected area 157
4 Need to identify actual looser to make the list of priority relief 153
5 Need to train people about warning system 153
6 Need relief of immediate food (puffed rice, flattered rice, molasses) for survival 152
7 Need to maintain sluice gate 147
8 Need to reconstruction of sanitary latrines 147
9 Need to give emphasis and allocate budget for the development work for climate vulnerable area in
the Annual Development Plan (ADP) by Government
10 Need pure drinking water, water purification tablet, jerry cane 146
11 Need to reconstruction of road 145
12 Need to establish disaster/climate fund in the Union Parishad for the next time disaster that they can
use it for early recovery stage.
13 Easy access to bank/government/NGO's loans with low interest 142
14 Need for immediate relief facilities (by the army) 141

No. Common Low-Adaptation Issues in Four Case Studies
(Integrated WI Value 120-100)
Integrated WI Value
(Total 160)
1 Need to raise the boundary of ponds 119
2 Need to put net around the boundary of ponds in order to prevent fish being carried away by flood
3 Need of immediate cash for survival after disaster 116
4 Selling land 116
5 Need loan for next seasons/ transition periods cropping, agricultural inputs, laboring, land
preparation, watering without interest for 3 years or with very low interest
6 Need of loans for immediate foods 114
7 Need to store immediate food item & non-food item in the Union Parishad for the next time disaster
that they can use it for early recovery stage.
8 Burial of dead bodies/animals 112
9 Need of immediate fuel/moveable stove 111

10 Need to train people through technical education 111
11 Need medicine/ health care 107
12 Need of temporary shelter construction material (Bamboo, rope, Plastic sheet) 105
13 Need of cash for work activities 105
14 Changing cropping pattern (time) 103
15 Need to recover the loss of students during and post disaster period 103
16 Need of cyclone shelter which should be multi-purpose (schools, drying wet crops) 101
17 Need to relief from the interest of loan for 1 year after the disaster 100

No. Common Very Low Adaptation Issues in Four Case Studies
(Integrated WI Value below 100)
Integrated WI Value
(Total 160)
1 To move temporarily to other northern part/Faridpur/Gopalganj for paddy harvesting work. 99
2 Change of occupation 98
3 Need for alternative source of drinking, cooking water (i.e.Rain water harvesting, PSF) 98
4 Need to grow seedlings on flood free high land immediately 96
5 Need to establish easy communication 94
6 Need of small boat for transportation 93
7 Need to reconstruction of embankment which Height, Width, Riverside, Country side should be
increased 5 feet, 6 feet, 10 feet, 30 feet, 12 feet more respectively.
8 Need to stop cutting mangrove forest 86
9 Need of loans for seedlings from professional lenders/wealthy persons/rich relatives/local land
10 Need to stop converting agriculture land to shrimp farming 85
11 Need to establish technical/vocational school 82
12 Selling personal belonging 81
13 Shifting house from outside of embankment to inside the embankment 81
14 Need permanent migrate to better place 80

Policy and Governance


Policy Instruments for Sustainable Consumption: A Comparison of
United Kingdom and Australian Initiatives
Fred Gale

School of Social Sciences, Faculty of Arts, University of Tasmania, Australia
* Email:
At the 1992 Earth Summit, countries identified sustainable consumption and
production (SCP) as a core part of the sustainable development agenda.
International negotiations on appropriate policies and programs since then
culminated in agreement at the 2012 RIO+20 Conference on a ten-year framework
of programs. Despite a collective commitment to SCP at the UN, analysts report only
limited national progress to date. In this paper, I set out a framework of policy
instruments available to governments to implement an SCP agenda. I then compare
progress on national implementation in the United Kingdom (a global leader) and
Australia (a global laggard). I conclude that the UK claim to leadership may be
overstated because, while it has established a formal SCP program unlike Australia,
the policy mix in both countries is quite similar.
Sustainable Consumption, Policy Instruments, Australia, United Kingdom, United
There is now ample evidence that high levels of consumption contribute to resource
depletion, ecosystem degradation, global warming and other environmental
problems (e.g., EEA 2013; UNEP 2013). Consequently, many governmental,
business and civil society actors are recognising that the pursuit of sustainability
must include inculcating more sustainable consumption patterns across the world,
especially in the rich countries of the global North (e.g. UK Government 2003;
WBCSD 2012). In the two decades since the 1992 United Nations Conference on
Sustainable Development (UNCED), the issue of Sustainable Consumption and
Production (SCP), has moved steadily up the international agenda and featured in
the recent 2012 Rio+20 outcome, The Future We Want. In this paper, I compare how
two national governments, Australia and the United Kingdom, have engaged with the
SCP agenda. To make the comparison, I develop a list of policies that could be used
to deliver SCP and locate them along a sustainability spectrum from weak to
strong based on whether they are informational and voluntary on the one hand or
regulatory and mandatory on the other. I then review the policies and programs that
Australia and the United Kingdom have implemented, choosing the latter country

because it is a recognised global leader in SCP. I find the UKs claim to SCP
leadership to be exaggerated as most of its policies cluster towards the weak pole of
the sustainability spectrum and do not differ greatly from those implemented by
Sustainable Consumption and Production at the United Nations
Two decades ago at the United Nations Conference on Environment and
Development (UNCED) at Rio de Janeiro, Brazil world leaders took the first faltering
steps towards institutionalising SCP. Agenda 21 contained a chapter on Changing
Consumption Patterns that stated: the major cause of the continued deterioration of
the global environment is the unsustainable pattern of consumption and production,
particularly in industrialized countries, which is a matter of grave concern,
aggravating poverty and imbalances (United Nations 1992, 4.2). At a follow up
symposium in 1994 in Oslo, Norway, SCP was defined as the use of services and
related products, which respond to basic needs and bring a better quality of life while
minimizing the use of natural resources and toxic materials as well as the emissions
of waste and pollutants over the life cycle of the service or product so as not to
jeopardize the needs of further generations (quoted in Fuchs & Lorek 2005). Fuchs
and Lorek claimed the definition captured a strong notion SCP because it focused
on concepts like basic needs and quality of life, and on minimising natural and
toxic material use over the life cycle (2005, p. 261). They noted that SCP contained
two components: a techno-efficiency component, whereby supply-side
improvements in production enabled the same product to be consumed with less
environmental impact; and a socio-behavioural component, whereby consumption
patterns are altered to achieve less, and greener, consumption levels. Fuchs and
Lorek also noted that the overwhelming emphasis was placed on the supply-side,
techno-efficiency component, and that the socio-behavioural component had been
neglected. In a recent review Barber (2010) also notes limited progress. Entitled Still
Waiting for Delivery, Barbers analysis highlights how conferences, meetings,
workshops and symposia on the topic of SCP have not translated into strong action,
especially in support of the diverse array of civil society initiatives being implemented
across the globe.
Last years 20-year UNCED anniversary conference, branded Rio+20, offered a
renewed opportunity for countries to commit to SCP. The Preamble to the
Conferences outcome document, The Future We Want, states that: We recognize
that poverty eradication, changing unsustainable and promoting sustainable patterns
of consumption and production, and protecting and managing the natural resource
base of economic and social development are the overarching objectives of and
essential requirements for sustainable development (UN 2012, para 4, emphasis
added). The Rio+20 meeting also approved a 10 Year Framework of Programmes
on sustainable consumption and production (10YFP). The result of almost a decade

of negotiations that commenced in Marrakech, Morocco, in 2003, the 10YFP
contains the following provisions:
The 10YFP runs from 2012 to 2022;
Developed countries should take the lead;
National programs should be flexible and tailored to national circumstances;
Programs adopted should conform to the provisions of international trade law;
UNEP should serve as the Secretariat;
Programs supported by the 10YFP are to be voluntary (UN 2012, 10YFP,
para 8).
Policy Tools for Sustainable Consumption
Given the recent recommitment of governments to SCP at Rio+20, it is timely to
review the policy tools available to them to take action. A list of governmental policy
instruments that could be deployed is presented in Table 1. The list has been
developed from the literature on policy instruments (see, for example, Howlett et al.
1995; Jordan et al. 2007; Lascoumbes & Le Gales 2007; UNEP 2013) and covers a
wide range of possible options. Four broad types of policy instruments are identified:
regulatory, economic, informational and infrastructural, which each work in a different
way. Regulatory instruments are traditional command and control arrangements,
where governments mandate actions of a particular type that are backed by fines
and penalties. The setting and enforcing of regulatory standards for energy
consumption and pollution is a good example of this approach. In contrast, economic
policy instruments aim to create market incentives to guide consumer action. Taxing
carbon intensive goods illustrates this approach. Under the heading informational
policy instruments, a range of measures can be taken to inform the public about the
environmental and social consequences of their purchases. Certification and
labelling schemes that provide consumers with more information about the energy
efficiency of their purchases illustrate the approach. Finally, infrastructural policy
instruments tackle some of the well-known constraints on consumer behaviour
imposed by socio-technical regimes (Seyfang 2011). Policies to build a network of
bike-lanes to foster cycling to work are an example.
The question arises as to which instruments have been most used, and which least,
in the pursuit of SCP over the past decade in national programs and on whether the
policy focus has been on regulating producers or consumers. From a political
economy perspective, the expectation would be that policy would favour instruments
that are compatible with the current neoliberal global orderi.e. instruments would
not be deployed if they are perceived to be incompatible with private property rights,

free markets, and individual choice. Likewise, it would also be expected that policies
and programs would be directed towards production efficiency rather than to
constraining consumer demand.
Table 1: Sustainable Consumption Policy Instruments
Regulatory Policy
Economic Policy
Informational Policy
Advertising regulation
(e.g. junk food,
tobacco, alcohol)
Taxation (e.g. increase
cost of carbon intensive
Eco-labelling schemes
(e.g. Germanys Blue
Angel scheme, EU
Urban design (e.g.
high density
Licences and
prescriptions (e.g.
firearms, motor
vehicles, aircraft)
Subsidies (e.g. offset
costs of solar
installation, home
insulation, public
Certification and labelling
schemes (e.g. Forest
Stewardship Council,
Marine Stewardship
Public transport
(e.g. cycle lanes,
high-speed rail)
Age limits (e.g. bars,
casinos, movie
Market creation (e.g.
emissions trading
Information schemes (e.g.
buy local, buy organic,
live sustainably)
(e.g. NBN)
Quotas (e.g. water
use, fishing)
Deposit-refund schemes
(e.g. beverage bottles)
Voluntary green
procurement (e.g.
Australian governments
green procurement

Standards (e..g
building standards,
fuel efficiency
standards, etc);
Mandatory green
procurement (e.g. UK
Governments timber
procurement scheme)
Roundtables to promote
stakeholder dialogue on
sustainable consumption
and production;

Credit controls (e.g.
regulations on private
lending; credit card
limits; interest rates) ;

Sources: Howlett et al. 1995; Jordan et al. 2005; Lascoumbes & Le Gales 2007; UNEP
The policies listed in Table 1 can be located along a sustainability spectrum from
weak to strong. Weak SCP policies would be expected to be voluntary rather than
mandatory in terms of obligations imposed; vaguely rather than precisely stated in
terms of the actions required; narrowly rather than broadly targeted; and with a focus
on production efficiency rather than consumption sufficiency (Princen, Maniates &
Conca 2002). Strong SCP policies on the other hand would be expected to be the
obverse. They would be mandatory rather than voluntary, precise rather than vague,
and widely rather than narrowly targeted. For illustrative purposes, the location of

some of the policy options set out in Table 1 along the weak-strong sustainability
spectrum is set out in Figure 1 below. This schema for ranking SCP policy
instruments will be employed in the case studies below to assess where individual
schemes are located along the weak-strong spectrum.

Figure 1: SCP Policy Options Ranked Along Weak-Strong Sustainability Spectrum
Comparing Sustainable Consumption Initiatives: UK and Australia
In evaluating national programs for SCP, useful distinctions can be made between
official government-sponsored programs and programs sponsored business and civil
society organisations. Furthermore, government programs can be distinguished
between those that emphasise efficiency (achieving more outputs with fewer inputs)
and those that emphasise sufficiency (reducing the volume and type of
consumption taking place). The way national SCP policies are developed can also
be distinguished, with deliberative approaches involving widespread discussion and
bureaucratic approaches typically limiting input to government agencies (see
Princen et al. 2002; Berg 2011; and Seyfang 2011).
Building on Agenda 21, the Oslo Symposium and the 2003 Marrakech Process,
some countries became early adopters of SCP. The UK and Japan both launched
programs in 2003, followed by Sweden (2005), France (2006), and the European
Union (2007) (Barber 2010). Today, a range of initiatives are in operation around the
world (UNEP 2012). Since a comprehensive analysis of these initiatives is beyond
the scope of this paper, I focus instead on comparing the UKs program, regarded as
a leading example in Europe, with Australias efforts in terms of policy instruments
and policy focus.
The United Kingdom
The UK was one of a handful of countries to respond quickly to the call for action on
SCP. In 2003, it released a document entitled Changing Patterns: the UK Framework
for Sustainable Consumption and Production. Changing Patterns set out a
framework for action built around the principles of (i) decoupling economic growth
from environmental degradation; (ii) targeting policy to the most important

environmental impacts of resource use; (iii) increasing the productivity of material
and resource use (i.e. improve efficiency); and (iv) encouraging active and engaged
consumers to practice more SCP (UK Government 2003). To achieve these
outcomes, Changing Patterns focused on life-cycle analysis, market-compatible
action, integrating SCP into policy decisions, appropriate policy design, and
stimulating innovation. The document located the lead agency as the Department of
Environment, Food and Rural Affairs (DEFRA) and tasked it to get more out of
existing sustainable production programs, review procurement policy, establish
collaborative projects, foster the SCP debate, and work on indicators for sustainable
development (UK Government 2003).
Shortly after releasing Changing Patterns, the UK Government also released its
Sustainable Development strategy, Securing the Future. Chapter 3 of this document
sets out a One Planet Economy: Sustainable Production and Consumption agenda.
This document states that the goal of SCP requires us to achieve more with less
(UK Government 2005, p. 43) and notes that the key sectors of concern are
household energy, water, food, travel and tourism. The document commences with a
focus on product designcutting out problems at source and production efficiency
(UK Government 2005, p. 47), before discussing other dimensions of SCP. It notes
that there will also be a need for households, businesses and the public sector to
consume more efficiently and differently, so that consumption from rising incomes is
not accompanied by rising environmental impacts or social injustice (UK
Government 2005, p. 51). The document emphasises the social and cultural
influencers of consumption and calls for the building of an evidence base of the
environmental impacts of household consumption.
In a recent review of the UK program on SCP, Berg (2011) makes two key findings.
These are firstly, that the origins of the program were based around a strategy of
deliberation, which involved a large number of groups in government, business and
civil society; and secondly, that the content of the program was largely weighted
towards efficiency measures. For Berg (2011, p. 16), the UK program highlights
unsustainable trends but fails to push consumers to reduce their consumption,
signalling a weak sustainability approach. In another evaluation, Flanagan and
Weatherall (2013) examine some of the major government-backed SCP initiatives
underway in the UK.
They identify eight government-supported activities that range
from the Green Carbon Hub and the Voluntary Retail Initiative for Televisions to the
Love Food Hate Waste and Every Action Counts campaigns. An analysis of the
policy content of these initiatives is provided in Table 2.
As can be seen from Table 2, the programs listed aim to improve the efficiency of
specific types of products (e.g., houses, boilers, TVs), reduce waste in some sectors

Curiously, the authors exclude a major government initiative to mandate the green procurement of
timber products using eco-certification and labelling schemes raising questions about the reviews
comprehensiveness. See CPET 2014 for scheme details.

(e.g. household food consumption, household energy use), and promote sustainable
living in advertising campaigns and using community-based monitors. Three broad
policy instruments are utilised: regulation (via setting new efficiency standards),
economic incentives (via subsidising industry or consumers to undertake the desired
action), and information (via campaigns to inform industry and/or consumers about
the environmental consequences of different purchasing decisions). These policies
have focused both on altering production and consumption behaviour. The impact of
these various efforts has been mixed. According to Flanagan and Weatherall (2013,
p.3), there is a complex interaction between campaigning for consumers to change
behaviour and promoting policy change at local, national or European level
Perhaps the clearest conclusion from this mix is that an effective policy environment
in tandem with powerful consumer awareness and engagement initiatives is vital if
we are to see sustainability come fully to the forefront in citizens consumption
choices. A provisional evaluation of each initiative in the final column indicates that 6
of the 8 fall towards the weak sustainability pole of the weak-strong sustainability
spectrum and only two can be considered moderate sustainability.
In 2003, Hobson (p. 149) noted that sustainable consumption has failed to become
a political or public issue in Australia. This conclusion appears to be based on the
fact that, unlike the UK, Australia did not have or intend to develop an explicit SCP
policy or program. However, the absence of a clearly defined program does not
mean that Australia was not taking any action. In 2004, UNEP produced a document
entitled Tracking Progress: Implementing Sustainable Consumption Policies that
included a case study on Australia as one of a group of countries that has taken a
leadership role in supporting and facilitating international work on changing
consumption and production patterns (UNEP 2004, p. 30). Tracking Progress
observed that one early Australian initiative was the publication of a 1996 booklet,
More with Less: Initiatives to Promote Sustainable Consumption, by the-then
Department of the Environment, Sport and Territories (DEST 1996). More with Less
stated that a key element of moving to achieve a sustainable world is changing the
consumption patterns of the worlds people, which in industrialised countries meant
learning how to have an acceptable quality of life while substantially decreasing
current levels of demand on the earths resources and environment (DEST 1996, p.
2). The booklet contained a compendium of actions being taken in support of SCP by
governments, industry and civil society. Of the 29 initiatives listed, six involved the
Australian federal government.
Tracking Progress inventories the numerous other programs have been established
since the publication of More with Less (UNEP 2004, pp. 30-31). In addition to listing
a range of new initiatives the report notes that a major focus of Australias work on
SCP is assisting the OECD with its Work Programmes on Sustainable Consumption
and Production and Increasing Resource Efficiency (UNEP 2004, p. 31). It also

stated that Australia has worked to embed life-cycle analysis in production, promote
national recycling schemes, strengthen consumer regulation, employ economic
measures in support of SCP, provide public information, support impartial testing of
products, promote research on consumer behaviour to make consumption patterns
more sustainable, and engage in green procurement.
Despite the favourable account of Australias engagement in SCP in Tracking
Progress, the country barely features in a recent UNEP report entitled Global
Outlook on Sustainable Consumption and Production Policies. In the reports Asia-
Pacific section, the only Australian governmental program mentioned is the
Australian National Packaging Covenant which aims to reduce packaging waste and
increase recycling which was negotiated in 1999 (UNEP 2012). The paucity of
information about Australias SCP initiatives in this document could be because,
rather than undertaking an inventory of what individual countries are doing, it is
assessing globally significant responses to SCP. It is notable, however, that the
report cites several UK examples of SCP, devoting a full page on the UKs
comprehensive framework on SCP, a box on the UKs Sustainable Clothing Action
Plan, and full details of its EU-directed Market Transformation Programme.
The absence of an official program on SCP coupled with no recent formal inventory
of Australias actions makes it somewhat harder to compile a list of project
comparable to those of the UKs. More with Less was compiled in 1996 and
combines federal government programs with state and local government programs
as well as those initiated by industry and civil society. In contrast, while Tracking
Progress is somewhat more recent, it includes a range of initiatives that Australia is
undertaking to achieve the broader objective of sustainable development rather than
SCP per se. To obtain a list of current Australian federal government initiatives in the
field of SCP, therefore, I have used a mix-methods approach that combines those
programs clearly related to SCP listed in More with Less and Tracking Progress with
those listed in UNEPs Global Outlook. The list of initiatives generated by this
approach appears in Table 3 coupled with an evaluation of their location along the
weak-to-strong sustainability continuum.

Table 2: A Selection of Policy Initiatives Used in the UKs Sustainable Consumption Program
(Year Initiated)
Description Policy Instruments Policy Evaluation
Zero Carbon Hub
Promote zero-carbon building
construction by 2016
Regulation via standards: modifications to UK
building code requiring new homes to be more
carbon efficient;
Information via roundtable: Financial support for
hub to investigate construction and marketing of
zero/low carbon houses;
Mandatory, precise, narrowly production-focused,
efficiency initiative: seeks to make new homes more
energy efficient by tightening standards but does not
limit size of new homes;

Rating: Moderate Sustainability
Efficient Boilers Programme
Promote energy efficient
boilers for water heating in
Regulation via standards: modification to UK
building code to mandate use of energy efficient
boilers by 2016;
Industry incentives: government provided training to
Consumer incentives: voluntary incentives for
householders to replace old with new boilers;
Mandatory, precise, narrowly production-focused
initiative coupled with voluntary component; seeks to
promote construction and installation of more efficient
boilers by tightening standards;

Rating: Moderate Sustainability
Energy Saving Trust
Recommended certification
and labelling scheme
Encourage consumers to
purchase energy saving
household appliances
Informational instrument: indicates which
appliances fall within the top 20% in terms of
energy rating; funded by government until 2010 and
transitioned to fee-paying system;
Voluntary, precise, narrowly-focused, informational
instrument with consumption focus; seeks to inform
consumers about the energy rating of appliances;
Rating: Weak Sustainability
Television Voluntary Retail
Remove most energy
inefficient TVs from the
Government-Industry Cooperation: encourages
choice editing to remove least efficient TVs;
Industry incentive: government supported industry
(via Energy Saving Trust) in its voluntary actions
via marketing and PR support;
Voluntary, precise, narrowly production focused
instrument: aimed to remove least energy efficient TVs
from the market via choice editing;


Rating: Weak Sustainability
Love Food Hate Waste
Reduce waste in the food
Informational instrument: government funding for
Waste and Resources Action Programme (WRAP)
to run publicity campaign on consumer waste in the
food industry;
Voluntary, broad, consumption focused informational
instrument: awareness campaign over food waste
Rating: Weak Sustainability
Every Action Counts (2006) Encourage sustainable
practices energy, travel,
shopping, resources and
Informational instrument: government funding for
voluntary groups to train community champions to
promote sustainable consumption;
Voluntary, broad, consumption focused training and
informational instrument: building community capacity
on sustainable consumption practices
Rating: Weak Sustainability
Support policy development
in Defra and other agencies
Informational instrument: aims to improve
knowledge base for government policy on
sustainable consumption;
Broad, informational and research, efficiency and
sufficiency oriented policy instrument; build
government SCP capacity
Rating: Weak Sustainability
Energy Saving Trust (1992) Support for consumers to
reduce household energy
Informational instrument: Government funding for
energy efficiency advice centres to advice
households on ways to reduce energy use;
Voluntary, broad, consumption focused, informational
policy instrument: provide consumer advice on ways to
reduce household energy use
Rating: Weak Sustainability
Source: Flanagan & Weatherall 2013.

A comparison of SCP governmental initiatives in the UK and Australia reveals a
number of interesting results. First, it is clear that despite not having an official SCP
policy or program, the Australian federal government is undertaking a range of not
dissimilar actions to those undertaken in the UK. The UKs Changing Patterns
program may have given more public prominence to the ideas of SCP, but many of
the actual programs and policies appear common across both countries, with a focus
on tackling household energy usage, promoting production efficiency in specific
sectors, and providing public information to encourage people to reflect on and
address their consumption patterns.
Secondly, not only do the programs have the same broad focus, but the dominant
policy instruments used in both jurisdictionsconsumption side information policies
supplemented with production-side regulation to establish and/or tighten standards
appear similar. A lot of programs in both countries provide information to interested
consumers on how to engage in green consumption via booklets, websites and
community champions. In the UK, this took the form of campaigns like Love Food
Hate Waste, Every Action Counts and Energy Saving Trust; parallel programs in
Australia are Your Home, Shop Smart, Living Greener and E3. These initiatives
enable interested consumers to get tips and information concerning how to reduce
their energy bills and household waste and select the most efficient electrical
Thirdly, both governments have used economic policy in the form of subsidies and
taxation to promote SCP in discrete sectors. The UK Government subsidised
consumers to retrofit their homes with more efficient boilers after 2009 and the
Australian government has subsidised consumers by partially offsetting the cost of
installing solar energy in recent years. Both governments have also subsidised
producers to improve productive efficiency. The UK Government subsidised the
costs incurred by companies installing new boilers and retailers engaged in choice
editing out inefficient TV sets; and the Australian government obliged importers to
pay a levy to offset the costs of recycling oil at the end of the supply chain and
subsidised research and develop in the packaging industry to reduce waste.
Fourthly, in neither jurisdiction have measures been deployed to directly reduce
consumption by reducing consumers disposable income. Income reductions could
be achieved by manipulating by manipulating income tax, interest rates, and
consumption taxes and by introducing luxury and inheritance taxes. While these
economy-wide measures would likely exert a powerful impact on the general level of
social consumption and, properly targeted, could create significant price incentives to
shift away from energy inefficient and carbon- and resource-intensive goods, to date
they have not been employed as policy options by either government.

Table 3: A Selection of Policy Initiatives Used in Australia to Promote Sustainable Consumption
Name Source Description Policy Instruments Policy Evaluation
Energy Rating Labelling of
Electrical Appliances (now E3 for
Equipment Energy Efficiency
More with
Less and
Star rating of energy efficiency
of electrical appliances
Information instrument: public
information about the energy efficiency
of consumer appliances using a six
star rating system
Voluntary, consumption focused, narrow,
information instrument: provides
information to consumers on energy
efficiency of household electrical
Rating: Weak Sustainability
National Recycling Plan Targets
(recently supplemented with
National Television and Computer
Recycling Scheme)
More with
Establish national targets for
Industry regulation: industry targets for
waste recycling; updated for e-waste
from TVs and computers.
Voluntary, production-focused, narrow,
targets development; aims to tighten
standards for waste production;
Rating: Weak Sustainability
Excise tax on leaded petrol More with
Less and
Increased cost of leaded over
unleaded petrol
Economic instrument: excise tax on
leaded led to rapid decline in demand
and eventual phase out
Mandatory, consumption-focused, targeted,
economic instrument; increased price of
leaded over unleaded petrol;
Rating: Strong Sustainability
Solar Hot Water Subsidies
(updated/ supplemented with
Small-Scale Renewable Energy
Scheme (SRES)
Progress and
Google search
Encourage consumers to
install solar (and alternative)
household energy systems
Economic instrument: consumer
subsidy for installing solar and
alternative household energy systems;
Voluntary, consumption-focused, targeted,
economic instrument; subsidy to
households to partially offset cost of
installing solar and alternative energy
Rating: Moderate Sustainability
Your Home, Shop Smart, Living
Greener, etc
Progress and
Google search
Booklets/websites providing
information on how to live
more sustainably
Information instrument: booklets and
websites providing information on how
to live more sustainably
Voluntary, consumption-focused, broad-
based information instrument: provide
information in the form of guides on how to

live more sustainably;
Rating: Weak Sustainability
Waste Oil Product Stewardship
Producers and retailers of oil
products pay levy to subsidise
cost of recycling
Economic instrument: levy on oil
importers to subsidise costs of
recycling borne by recyclers;
Mandatory, production-focused, targeted
economic instrument; ensure costs of
recycling waste oil are internalised within
supply chain;
Rating: Moderate Sustainability
Australian National Packaging
Global Outlook To reduce packaging waste
and increase recycling
Government-Industry-Civil Society
Cooperation: ANPC funded by
government and industry;
Industry incentive: ANPC provides
project funding to reduce packaging
Voluntary, production-focused, targeted,
economic instrument; aims to reduce
packaging waste in industry;
Rating: Moderate Sustainability
Water Efficiency Labelling and
Standards (WELS) scheme
Global Outlook Regulates some water using
devises to ensure water
Government Regulation: establishes
regulatory requirements for some
water using devices (like showers,
toilets, taps) to conserve water;
Mandatory, production-focused, targeted,
regulatory and standards instrument: aims
to improve efficiency of water using devices
by tightening standards;
Rating: Moderate Sustainability
Sources: DEST 1996; UNEP 2004; UNEP-EU 2013.

This lack of political will reflects both a lack of awareness of what a strong
sustainability approach to SCP would entail as well as well-founded fears that such
policies would unleash a voter backlash, resulting in the loss of political power at the
next election.
The recent Australian election is a salutary lesson in the politics of sustainable
consumption and production as the Opposition Liberal Party under Tony Abbott
campaigned against a very modest carbon tax proposal put in place by the minority
ALP Government. While it is true in part that the Opposition was able to exploit the
issue as another ALP broken promise, there is little doubt that the tax was very
unpopular with many in the business community who experienced increased costs.
The almost three-year Liberal assault on the tax was effective: with her personal
popularity plummeting in opinion polls, the ALP replaced Julia Gillard as Prime
Minister with the former leader Kevin Rudd. However, by then it was too late and the
ALP was defeated in a thumping victory by the incoming Liberal-National Party,
which immediately introduced a Carbon Tax Repeal Bill. While the Bill was rejected
by the Senate, it is likely to be reintroduced when the new Senate sits after 1 July
2014. Overall, this experience with regard to a very modest carbon tax will certainly
give many politicians pause for thought. Based on this experience, it seems highly
unlikely that any major party would consider basing its policies on a strong
sustainable consumption agenda as the tough tax and regulatory measures required
to raise the cost of carbon- and resource-intensive consumption and dampen
consumer demand would almost certainly provoke a political and popular backlash.
This paper has outlined the emergence of SCP on the international policy agenda,
identified a range of policy instruments that could be used to implement it, and
compared and evaluated a selection of the programs in place in the UK and Australia
to better understand what governments are currently doing. While the UK was an
early, formal adopter of SCP and launched a policy on the topic in 2003, in fact both
Australia and the UK have adopted similar program elements using similar policies to
achieve SCP in the past two decades. In both countries, there has been an
emphasis on enhancing productive efficiency in discrete sectors which has been
coupled with public outreach campaigns to encourage consumers to voluntarily alter
their consumption patterns. The majority of the programs lie at the weak
sustainability pole of the weak-to-strong sustainability spectrum. Thus, while
governments notionally have a large number of policy instruments available to tackle
unsustainable consumption, many instruments with broader, economy-wide effects,
have not been used. While it is possible that the policy instruments that are linked to
strong sustainability have not been deployed for fear of their impact on growth and
like voter backlash, further investigation is required into exactly why governments
are, so far, desisting from using them.

This study is a provisional investigation into policy instruments and SCP in the UK
and Australia and a number of shortcomings should be noted. Firstly, the analysis of
the SCP initiatives underway in the UK and Australia has relied on the work of other
investigators, whose own studies appear to be somewhat selective. It is clear that
national governments are implementing more programs than those listed in public
and academic documents. In part, this reflects difficulties in determining the scope of
the concept sustainable consumption and production and what initiatives it might
encompass. A full, systematic inventory of all of the SCP initiatives underway in both
countries is required to reach more definitive conclusions on which is actually
exercising leadership. Secondly, the article has not investigated the large number of
SCP initiatives being undertaken at the sub-national level by regional and local
governments, business, and civil society actors. A comprehensive comparison of the
UK and Australia in terms of SCP would need to include the initiatives being
implemented by these actors too.
A heart-felt thanks to research assistant Helen Panzer, who prepared an early
version of the UK case; and to UTAS Governance and Implementation Group
(GIRG) for grant funding to undertake the study.
Fred Gale is Associate Professor and Director, Governance and Implementation
Group, University of Tasmania. His research examines the role certification and
labelling schemes play in developing socially and ecologically sustainable supply
chains and promoting sustainable consumption. He has completed in-depth studies
of the Forest Stewardship Council and Marine Stewardship Council. Recent books
include Setting the Standard: Certification, Governance and the Forest Stewardship
Council (UBC Press 2008), Pulp Friction in Tasmania: an Evaluation of the
Environmental Assessment of Gunns Pulp Mill (Pencil Pine Press 2011), and Global
Commodity Governance: State Responses to Sustainable Forest and Fisheries
Certification (Palgrave Macmillan 2011).
Barber, J. 2010. Still Waiting for Delivery. Silver Springs, MD: Integrative Strategies
Forum and the International Coalition for Sustainable Production and Consumption.
Berg, A. 2011. Not Roadmaps but Toolboxes. J. Cons. Pol. 34: 9-23.
CPET (The Central Point of Expertise for Timber Procurement). 2014. The UK
public procurement policy on timber: Overview of the policy. Online at:, accessed 03
June, 2014.

DEST (Department of the Environment, Sport and Territories). 1996. More with Less.
Environmental Economics Research Paper No. 3. Canberra, ACT: Commonwealth
of Australia.
EEA (European Environment Agency). 2013. Environmental pressures from
European consumption and production. Luxembourg: Publications Office of the
European Union.
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Chinas Carbon Markets: Prospects and institutional barriers
Alex Y. Lo
Griffith School of Environment, Griffith University, Gold Coast campus, Queensland
4222, Australia
*Email:; Ph: +61+(07)+ 5552-7419
The potential scale of Chinas emission trading schemes has raised prospects for a
regional carbon trading network. However, the Chinese carbon markets rest upon a
unique political-economic context and institutional environment that are likely to limit
their development and viability. This article offers an overview of such structural
economic and political constraints, and discusses the main challenges to the
development of carbon markets in China. It is based on an extensive review of
official policy documents, published research papers, and relevant news reports.
The article is divided into two main sections. The first one elaborates on the national
policy context in which Chinas carbon market and pilot ETSs are situated. The
second explains the structural hurdles to the development of domestic carbon
markets. Implications are discussed in the conclusions.
carbon markets; emission trading; climate governance; political economy;
developing country; China
In the past decade carbon emission markets have ascended to the dominant form of
institutions for climate change mitigation (Ellerman, Convery, & Perthuis, 2010;
Grubb, 2012; Lo & Spash, 2012; Mol, 2012; Spash & Lo, 2012). Global carbon
trades recorded an increasing market value of US$176 billion in 2011 (Kossoy &
Guigon, 2012, p. 10). About US$23 billion originated from the trading of secondary
carbon offsets under the Kyoto Protocols market mechanisms, notably the Clean
Development Mechanism (CDM). The entire CDM program is expected to reduce
2.2 billion tonnes of CO
from 2004, when the first CDM project was registered, to
the end of the first Kyoto commitment period in 2012
. China hosts most of the
registered CDM projects and supplies most of CDM carbon credits. During 2005 and

7,400 projects are registered under CDM, as of 14 December 2013. Source: UNFCCC CDM Official
Website (


2010, however, the countrys annual CO
emissions rose from 5.4 billion tonnes to
8.0 billion tonnes (International Energy Agency, 2013: 52), more than offsetting the
lifetime capacity of the CDM in emissions reduction. The CDM alone is clearly not
Global carbon finance needs to be scaled up by an order of magnitude in the second
commitment period. Some commentators see potential from outside the project-
based CDM. Allowance-based market mechanisms may be able to engage
emerging economies in ways similar to what is operating in Europe, i.e. the
European Unions (EU) emission trading scheme (ETS) (Grubb, 2012; Perdan &
Azapagic, 2011). The EU ETS is the worlds largest carbon market, which is worth
US$148 billion and has entered Phase III (2013-2020) of its implementation. Outside
Europe, progress has also been made in the Anglo-American world, with ETSs
emerging in New Zealand, Australia, California and ten northeastern states of the
U.S., British Columbia and Quebec (Canada). Major Asian economies are taking up
this trend, including Tokyo (Japan), South Korea, China, Kazakhstan, and India.
Some commentators pin their hopes for large-scale emissions reductions on China,
the worlds largest emerging market (Fankhauser, 2011; Guan & Hubacek, 2010; Lo,
2010, 2013; Wang, 2013).
There are growing prospects for a regional carbon trading network as a way to
further engage other major Asian economies since China declared a plan to
introduce ETSs in the late 2011. Seven pilot ETSs have come to operation in the
country since 2013 (Han, Olsson, Hallding, & Lunsford, 2012; Lo, 2012). The short-
term goal is to establish trans-provincial and trans-regional ETSs in transition to a
national ETS by 2015/16. The prospective national scheme may eventually become
the worlds second-largest after the EU ETS and mark a major step forward in
creating a global carbon market at a potentially higher value than the oil market. This
has brought some hope to advocates of a common carbon price across the globe.
However, Chinas carbon pricing policies are developed upon a different political-
economic context. The majority of the existing mandatory ETSs operate in mature
market economies safeguarded by a liberal democratic regime. In contrast, China is
a developing market economy with socialist political legacies (Lo, 2008a, 2008b,
2010; Tsang & Kolk, 2010). Also it currently does not assume any binding
commitment to absolute emissions reduction. These political realities have created
considerable institutional barriers to the development of domestic carbon markets in
This article offers an overview of such structural economic and political constraints,
and discusses the main challenges to the development of carbon markets in China.

It is based on an extensive review of official policy documents, published research
papers, and relevant news reports. The article is divided into two main sections. The
first one elaborates on the national policy context in which Chinas carbon market
and pilot ETSs are situated. The second explains the structural hurdles to the
development of domestic carbon markets. Implications are discussed in the
Chinas climate policy and recent development
Towards a market-based approach
China has risen to the worlds second largest economy and the largest national
source of greenhouse gases (GHGs), producing 25.4 per cent of the worlds total
emissions, or 5.9 tonnes CO2 per capita in 2011 (International Energy Agency,
2013: 52 and 103). In the 2009 United Nations Summit on Climate Change, the then
Chinese President Hu Jintao indicated that China will not accept mandatory national
targets for emission reduction until major developed countries take the lead. Later in
the Copenhagen conference, the Chinese delegate reportedly attempted to block the
development of the Copenhagen Accord (Christoff, 2010). China was blamed for
failing to assume tougher emission reduction targets and work with the international
community in meaningful ways.
Nonetheless, China has made some progress back home (Jiang, Zhuang, Miao, &
He, 2013; Zhang, 2007, 2011). China is the worlds leader in renewable energy
production (Schroeder, 2009), and carbon intensity declined over the last two
decades. Prior to the Copenhagen negotiations, the country substantially scaled up
its unilateral commitment: carbon intensity down by 40-45 per cent below 2005
levels by 2020. Official climate change policy programmes have been put in place
since the second half of 2000s. In 2007, China launched the National Climate
Change Program (National Development and Reform Commission, 2007). In 2008,
the White Paper on Chinas Policies and Actions for Addressing Climate Change
was released (State Council, 2008).
Chinas climate policy regime indicates two key features influencing the development
of domestic carbon markets. Firstly, economic interests are deeply embedded into
the climate policy framework more so than in major developed countries. The 2007
and 2008 policy documents are essentially an energy blueprint and none of them
makes reference to the Ministry of Environmental Protection (MEP), the national
environmental agency, or its predecessor (Lo, 2010). Climate change policies are
formulated and implemented by the National Development and Reform Commission
(NDRC), which is a macroeconomic planning and management agency under the
State Council (commonly known as the central government). The NDRC is a more

powerful administrative body, with its own energy and environmental departments,
than the MEP. It is worthwhile to note the NDRC is a co-chair of the National CDM
Board of China, whereas the MEP is only a Board member. The dominant role of the
NDRC indicates the strategic position of climate policy as being situated in the
context of energy security and conservation (Lo, 2010; Tsang and Kolk, 2010).
Climate change impacts are understood primarily in macro-economic terms (Sautter,
Second, China remains a planned economy in some aspects, despite the tendency
of decentralisation in environmental policy-making (Mol, 2009). Climate change is
treated by political elites and state administrators as a technical issue, for which
technical fixes are concentrated on energy saving measures and introduced in a top-
down fashion (Lo, 2010; Tsang and Kolk, 2010). Centrally planned policy guidelines
are published in a periodic legislative document known as the Five-Year Plan for
National Economic and Social Development (FYP). FYPs prescribe national
economic and social directions and coordinate policy priorities. FYPs are the most
prominent strategic blueprint for the country. Climate change was not written into
any FYP until the 11
FYP which covered the period of 2006-2010. Specifying
mandatory targets is a key feature of FYPs and the 11
FYP addressed climate
change by declaring commitment to an energy intensity target, i.e. 20 per cent
reduction during by 2010. Throughout this period, GHG control in China was
achieved largely through direct regulation. A range of administrative and political
measures were deployed, including government-funded incentives to support
installation of energy saving equipment, top-down imposition of energy saving
targets on energy-intensive industries, and forced closure of inefficient power plants
and factories. Market-based instruments played only a limited role.
Although Chinas institutional innovations have produced positive environmental
outcomes, they have not contributed to absolute reductions in emissions and energy
use (Mol, 2009). Success has been achieved only in relative terms. During 2000 and
2011, Chinas carbon intensity (CO
emissions per unit GDP) dropped by 19 per
cent, but the level of CO
emissions more than doubled (140 per cent) (International
Energy Agency, 2013: 97 and 52, respectively). The 11
FYP received a marginal
success against the emission reduction target. China managed to lower energy
intensity by 19.06 per cent by the end of 2010. This result, however, involved an
extended use of the visible hand, i.e. political intervention, such as electricity
rationing (Wu, 2011), and formal, coercive requirements on energy consumption
(Gilley, 2012). As part of the last-ditch efforts to meet the target, a number of
provinces were forced to shut down large swathes of industrial capacity, resulting in
the black-outs of some industries and certain cities towards the end of 2010 (Gilley,
2012; Han et al., 2012). The marginal success came with high costs.

This experience prompted the central government to seek a different strategy.
Market-based policy instruments immediately received attention from senior
government officials. Carbon taxes and cap-and-trade mechanisms are prime
examples of these instruments being put under serious consideration by the central
Tax, or trading, or both?
Carbon trading entered an uncertain period in 2009, when the world economy
stumbled and the Copenhagen conference failed to produce substantive agreements
on post-2012 commitments (Perdan and Azapagic, 2011). When the world economy
began to recover from the financial turmoil, China cast a vote of confidence for the
carbon market, ahead of the neoliberal U.S. Towards the end of 2010, senior
Chinese officials declared their ambition to establish a national ETS to curtail its
growing GHG output. In October 2011, the National Development and Reform
Commission (NDRC), Chinas top economic planning agency, granted official
approval to seven carbon trading pilot projects.
However, carbon taxes were actually the first candidate pulled out from the policy
toolbox (Wu, 2011; Han et al., 2012; Yu and Elsworth, 2012). Carbon taxation was
listed by the Ministry of Finance (MOF) as a promising carbon pricing approach as
early as 2007, and several peak government agencies and research institutions
were brought together to undertake preliminary research into its feasibility. It has
been supported by a group of prominent government and academic economists as a
practical option for China in the early stages of its transition to a low-carbon
economy in advance of a national ETS (Fan et al., 2011: 40). A new proposal for a
Chinese carbon tax was submitted to the MOF for official consideration in the early
2012, with a hope to roll out in the second half of the 12
FYP period covering the
period of 2011-2015 (Lin & Yang, 2012). Note that the carbon tax project is
principally coordinated by the MEP, the MOF and other finance agencies, whose
influences in the countrys climate policy regime are modest.
Carbon taxes are a fiscal measure that harnesses market forces for controlling
carbon pollution in ways opposite to carbon trading. Carbon taxes involve setting a
fixed price of carbon emissions and allowing the quantity of emissions to fluctuate,
whereas carbon trading involves fixing quantity of emissions and allowing the price
of carbon emissions to fluctuate. Cap-and-trade mechanisms produce efficient
outcomes by allowing the market to determine the right price. Therefore they are, in
theory, incompatible with carbon taxes which preclude carbon prices from changing.
Fan et al (2011) and Lin and Yang (2012) believe that the two policy instruments can
co-exist in a given period of time. While it is possible in theory for carbon taxes and

carbon trading to co-exist in a policy mix (Sorrell & Sijm, 2003), their potential
conflicts should not be under-estimated. Technical feasibility aside, carbon trading
has proven to be a preferred option being given higher political priority than the idea
of carbon tax, which has merely received scholarly appreciation and ministerial
The political preference for ETS is evident in the 12
FYP. Although the government
promises an annual GDP growth of 7 per cent under the 12
FYP period, it assumes
ever greater environmental commitments than under any previous FYP. Prominent
targets include an energy intensity reduction of 16 per cent and carbon intensity
reduction of 17 per cent by 2015 the first time when a CO
emission control target
is written into a FYP. Carbon trading has also found its way in the official agenda.
Confirmation comes from a brief statement in the 12
FYP that the country will
embark on the building of domestic carbon markets (State Council, 2011a: Chapter
21). This commitment is official and granted at the highest level. More details were
provided later in the thematic FYP on GHG control released by the State Council
(2011c) reiterating the commitment to domestic carbon trading. The political
endorsement articulated in these FYPs is authoritative, giving impetus to a top-down
approach by which the market construction project proceeds.
A formal notice of implementation outlining the Chinese ETS program was released
in October 2011 by the NDRC (2011) . The brief document states that, adherent to
the master plan of the Community Party and the State Council (i.e. the 12
the NDRC will gradually create a domestic carbon trading market (National
Development and Reform Commission, 2011). The announcements by the State
Council and its economic arm NDRC have not only confirmed the political priority of
establishing a compliance carbon market, but also painted a clearer picture by
appointing seven pilot sites across the country, including two provinces (Guangdong
and Hubei) and five cities (Beijing, Tianjin, Shanghai, Chongqing, and Shenzhen).
The short-term goal is to establish trans-provincial and trans-regional ETS in
transition to a national scheme by 2015/16. Individual pilot schemes have come to
operation since 2013.
Chinas climate change policies are formulated within the scope of continuing
economic development. Although considerable political efforts are being organised
to put a price on carbon, the overriding desire for economic growth and the
interventionist planning tradition have created practical obstacles to Chinas success
on the carbon trading front. These challenges are explained in the next section.
Structural constraints on the development of domestic carbon market

Cap and trade mechanisms are driven by formal regulations and/or voluntary
business commitments. In addition, they require a robust regulatory and legal
framework and a liberal market economy to produce efficient outcomes. The
Chinese carbon market falls short of the basic requirements and fails to play a
functional role. The Chinese experience is characterised by incomplete regulatory
infrastructure and excessive government intervention.
Incomplete regulatory infrastructure
Compliance carbon markets are regulation-driven. Under an ETS, firms are required
to surrender emission permits for a given amount of emissions produced. Legislation
is imperative to establishing the legal status of emission permits or allowances.
Enforcement and punishment are required in the event of non-compliance or
misconduct, where permits are not surrendered as stipulated, prescribed trading
rules are violated, or data reporting is found to be misleading. Moreover, the number
of permits a firm has to hold is assessed against available emissions data. An
accurate and consistent system for measurement, monitoring, reporting and
verification is essential to effective regulation of firms covered by an ETS.
Chinas regulatory infrastructure for carbon trading is far from complete. There are
considerable challenges in setting up robust monitoring, reporting and verification
mechanisms, which remain current in Europe and more so in China, where legal
enforcement is constantly a problem confronting all levels of the society. Currently,
there are no national regulations specifically for emission trading, and the on-going
ETS programme proceeds as an administrative operation. While any assessment of
regulatory performance in advance of the implementation of the pilot schemes is
inevitably inconclusive, it is useful to review other relevant regulatory experiences as
a reference point, such as the SO
The notion of SO
emission trading has come to China since the 1990s. Although
local governments had set up regulations for the SO
ETSs, the lack of transparency
in actual regulatory practice remains a concern. Emission trading rules are not
clearly articulated, and enterprises have little assurance that the trading
arrangements could protect their rights because under-the-table negotiations and
corruptions dominate (Tao & Mah, 2009). Market transparency is also limited due to
the absence of an effective information management and disclosure system (Tao
and Mah, 2009). Furthermore, the punitive mechanisms are poorly constructed.
Fines are too low to discourage non-compliance (Chang & Wang, 2010; Mol, 2009).
Violation for the second time is tolerated: a firm would not be fined twice for the
same polluting activity in the event of non-compliance, consequently creating little
motivation for buying or selling emission permits (Chang and Wang 2010). Locally

there is strong political resistance to the enforcement of environmental laws,
including those relating to emission caps that are thought to be detrimental to the
economy (Liu & Xu, 2012; Zhang, 2007). Bureaucrats generally have low motivation
to consistently enforce legal provisions.
Allocation of emission permits would be a source of faults if monitoring, reporting
and verification mechanisms lack accuracy and consistency. This is the current
situation in China, where official emissions data lack reliability (Zhang, 2011) and the
current systems are predominantly based on self-reporting (Tao and Mah, 2009;
Chang and Wang, 2010). Regulated firms prepare emissions reports by themselves
subject to occasional inspections by environmental agencies. They are only required
to report fuel inputs and emissions are not monitored on a regular basis, if ever.
Manipulation of emission data is not uncommon under some allocation methods
(Tao and Mah, 2009). Permit allocation remains arbitrary in the absence of reliable
information on which it is based. China is not known for effective legal enforcement
or disclosure of sensitive environmental information (Mol, He, & Zhang, 2011).
Excessive state intervention
The promise of economic efficiency relies upon the existence of a perfectly
functioning market. A necessary condition for an ETS to work is that prices are
allowed to fluctuate towards market equilibrium. The idealized setting is a free
market economy in which prices are determined by market dynamic and not being
controlled by a single party. This economic assumption has lost validity in actual
market settings. The European experience suggests that market power does exist
and the power industry, often dominated by a handful of large corporations, has the
ability to engage in activities such as mark-up pricing, price discrimination and
The current situation of the power market in China has violated that assumption in a
different dimension. Key economic policies are formulated by central authorities and
state intervention continues to affect every aspect of economic life. In this country
power prices are actively regulated by a central authority. Despite recent electricity
market reforms, electricity prices remain under the central governments control. The
Department of Price, a subsidiary of the NDRC, is responsible for moderating the
prices of key commodities, including electricity. Through its administrative arm the
central government sets a specific price for almost every newly built generation plant
since 1985 (Du, Mao, & Shi, 2009). There are large variations in the regulated prices
between or even within plants. The regulation of wholesale electricity price proves to
be ineffective (Du et al., 2009). Criteria for price control have been arbitrary.

Price control means that the carbon price under the ETS would reflect political
judgement, rather than marginal cost of production. Regulated electricity companies
would be prevented from passing the full cost to electricity users who are expected
to adjust their power consumption in response to price signals, as the central
government is highly concerned about the impacts of volatile prices on the economy,
particularly the possibility of inflation under the carbon price (Wu, 2011). A World
Bank report predicts that under a Chinese ETS which covers the power industry, the
Department of Price would play a central role in managing the cost of carbon and its
fluctuation (Kossoy and Guigon, 2012). The managed carbon price would effectively
become a kind of carbon tax in co-existence with a cap-and-trade mechanism, in
which both prices and emissions quantity are subject to some form of state control.
Prospects for economic efficiency are, however, uncertain (Sorrell and Sijm, 2003).
The regulatory experience with the Chinese SO
ETS has demonstrated the limited
scope for the market to operate free from arbitrary political manipulation. The SO

emission trade prices are largely modulated or instructed by the state depending on
the discretion of individual government officials (Tao and Mah, 2009). Emission
trading transactions have been subject to administrative intervention. In some cases
the government dominates the entire transaction process, including negotiation on
trading price, trading volume and terms of permit ownership (Tao and Mah, 2009).
Market competition has only recently come to existence in Chinas regulated power
sector in which political bargaining is prevalent. The legacy of planned economy has
created distortions to the ETS.
Given the tremendous economic implications of GHG control, the central and local
governments are tempted to execute the visible hand by modulating prices as they
do regularly to manage the economy. It is then uncertain as to how the power sector
can be brought into the prospective ETS. Gilley (2012) has noted that a key element
of Chinas climate policy discourse is the extensive use of authoritative power. This
governance tradition comes into conflict with the theoretical requirements for an
emission trading regime to operate efficiently.
China has made efforts on emission reduction in the context of continuing economic
development. The conditional commitment is evidenced by the declared preference
for intensity targets and compatible market-based mechanisms recently adopted.
Carbon taxes could fit the domestic context, whereas domestic carbon trading in
early stages lacked coordination and merely served to reap short-term benefits and
improve public image without demonstrated environmental achievements. However,
carbon trading has proved to be politically more attractive. High-level coordination is

underway and centrally approved ETSs are up and running. Political resistance has
softened; local emissions caps are being introduced and national caps are
imaginable in medium term. The real challenges are, however, how the regulation-
driven carbon market system works effectively with the state machinery which is not
primarily designed to support such system.
This article has identified two main challenges to the development of carbon markets
in China, namely, incomplete regulatory infrastructure and excessive government
intervention. These challenges tend to be institutional and arise from the unique
political system of China, which operates as a social market economy. The lack of a
robust regulatory and legal framework and the excess of government intervention
are more intractable governance issues. Modest changes in governing practice have
occurred along the tendency for decentralization of environmental policy-making.
However, some of the institutional barriers are rooted in the ways in which the larger
system operates and maintains its legitimacy. For example, improving the regulatory
and legal framework for GHG emission reporting will enhance transparency, but may
open up some sensitive energy security issues that the ruling regime has
traditionally been very cautious about (official data on provincial and municipal GHG
emissions are currently not open to public). Also, the ability to exercise direct
government intervention to the macro-economy (e.g. moderating utility prices)
proves to be important for the non-elected, ruling regime to maintain economic and
social stability in this country. Political efforts are required to address these deeply
entrenched institutional barriers and re-define the role of the state. Although the
ongoing ETS programme will introduce new institutional practices at various scales,
the success of Chinas carbon market reform crucially depends on the ability of
these new institutions to transform the distorted state-market relation.
Alex Lo is a faculty member of the Griffith School of Environment of Griffith
University. He specializes in the study of political economy and ecological
economics. His research focuses on climate change policy and politics, public
perception of climate change, and public engagement in climate change mitigation
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What factors are important for effective Greenhouse Gas emissions
Neale Wardley

Victoria Institute of Strategic Economic Studies, Victoria University, Melbourne,
This paper has sought to shed some light on the controversial cap and trade
programs favoured for the mitigation of greenhouse gas (GHG) emissions. In this
paper the complexities of the GHG emissions trading process are examined further
to establish a platform for the use of these market-based mechanisms. Evidence
from two case studies has identified an effective avenue by which to gain compliance
from the industrial sectors that are participating. On the surface the results of the
research suggest that this compliance can be translated into emissions reductions.
Other aspects of this paper synthesise from the data, a factorial framework for the
design of programs for GHG emissions trading. The factorial framework has been
engaged in this paper to assess the design parameters of the case studies. I.e. the
European Union Emissions Trading Scheme (EU ETS) and the US Regional GHG
Initiative (RGGI).The factors in this framework, for the trade of allowances in carbon
dioxide (CO
) emissions, are also discussed in terms of the US Acid Rain Program
(ARP) for sulphur dioxide (SO
) emissions.
Greenhouse gas emissions trading, Acid Rain Program
This paper was driven by the apparent controversy that has been associated with the
introduction of a system for market based environmental management. The
proposed mechanism is GHG emissions trading, which aims to put a price on carbon
emissions (CO
) and reduce the levels of anthropogenic Greenhouse Gases in the
atmosphere. In some regions a paradox exists between on one hand the theoretical
popularity and on the other hand the political unpopularity of this mechanism
(Ellerman 2011). From the nineties this contradiction is exemplified in Australia
where there have been a number of failed proposals for putting a price on carbon
(Beder 1999).
Between 1992 and 1997 the United Nations Framework Convention on Climate
Change (UNFCCC) formulated the Kyoto protocol. This protocol outlined emission

reduction targets for the so called Annexe 1 countries. It also introduced
mechanisms that, it was thought, could mitigate climate change. The UNFCCC
model introduced GHG emissions trading as a path to international cooperation to
reduce emissions through a process of linked national trading schemes. The theory
suggested that this would provide distributional flexibility and wide industrial sectoral
In 2007 the research began observing a period of high activity in the development of
cap and trade schemes for GHG emissions trading. In the literature these schemes
are also known as tradeable permit and quota programs. Despite the successful
application of quota programs in other areas, policy for GHG emissions trading is
regarded with a degree of derision.
This paper will discuss some of the broad findings of the research where it has been
shown that it is reasonable to expect that emissions can be reduced in line with the
modest program aims. This paper also reveals that a number of factors have been
found to be common across the policy development and implementation of GHG
emissions trading.
In the prior experience with the use of emissions trading, this paper has identified
support for cost effectiveness as a key element. In theory the emission abatement
costs will be minimised as the participants covered by an emissions trading scheme
seek the least expensive manner to reduce emissions. There is evidence which
suggests that the large-scale implementation of GHG emissions trading is difficult.
After limited experience with the pilot programs there are many unresolved issues.
An examination of these issues has revealed some of the fundamental factors that
contribute to a better informed conversation on the application of GHG emissions
The case studies in this paper are the European Union Emissions Trading Scheme
(EU ETS) and the U.S. Regional GHG initiative (RGGI). These case studies have
provided a data sample that has been able to address the parameters of the
research questions shown below.
Q1. Is there evidence from the case studies that the emissions of greenhouse
gases been reduced using emissions trading?
Q2. What factors are fundamental in the design of programs for GHG emissions
Q3. Of these factors, which ones are important in terms of the internal operation of
the programs and a carbon market?
Q4. Of these factors, which ones are driven by external forces that effect the
implementation of GHG emissions trading?

To tax or to trade
The pollution from the greenhouse gases is known to be an undesirable externality.
An emission-trading scheme is a quantity-based approach to account for an
undesirable externality. A carbon tax on the other hand is a price-based approach
(Pearce 2003). From the 1950s pollution was managed using one of two techniques,
i.e. Command and Control (CAC) or a so called Pigouvian tax on damaging
externalities, named after economist Arthur Pigou. (Tietenberg 2006; Baumol and
Oates 1988).
Hahn and Hester (1989) suggest that emissions trading theory has grown from a
property rights perspective and has covered a range emission types. Under CAC
policies governments allocated the spatial parameters for emission sources and
determined the upper limits for various pollutants, an end of pipe approach. This
approach has attracted some criticism because it requires an estimate by policy
makers as to the marginal cost of reducing emissions as does an environmental tax.
Both CAC and environmental taxes are subjective approaches which it has been
said bristles with difficulties (Coase 1960). It has been stated that the processes of
CAC or a tax on pollution did not ensure the highest possible value was placed on
the externality of pollution. Whereas in a market of tradable permits where the right
to pollute was made a factor of production, the social cost would be reflected in a
more accurate fashion. In Australia the recent application of a carbon tax was to be
carried out in an iterative fashion in accordance to the appraised social cost and
environmental damage caused by emitters.
Proponents of a carbon tax often refer to the marginal abatement cost curve (MACC)
which indicates that a tax can be cost effective in the early stages of abatement
when the marginal emission reduction costs are low (Nordhaus 1993, 1991;
McKitrick 1999). The MACC graphically represents the cost of abatement plotted
against the corresponding reduction of GHG emissions over time.
Several observers suggest there is a convergence in the economic efficiencies of the
alternative approaches of environmental taxes and tradable permits (Grubb 1990,
McKibbin et al 1999, Stavins 1995, Pezzey and Joskow 2012). A result of this
convergence has been the development of a hybrid design that combines both fixed
pricing (a tax) and permits or allowances for GHG emissions trading (McKibbin and
Wilcoxen 1997).
The Australian carbon pricing mechanism was to have followed the hybrid approach
that has been discussed by a number of authors such as McKibbin and Wilcoxen
(2002), McKitrick and Collinge (2000). The hybrid approach is aligned with the use of
a carbon price collar to constrain costs in the early stages of an emissions trading
scheme (McKibbin et al 2009 and CRPS 2008).

The evidence has been collected in the context of a changing Australian approach to
this problem as described by Sandu 2007; Howe 2007; Sandu and Sharma 2010.
There remains a degree of uncertainty about the best methods to mitigate the
greenhouse gases. In other cases in order to gain acceptance, it has been common
in the pilot programs for GHG emissions trading to set modest reductions targets at
the start. Some critics of emissions trading hold a view that the targets for emission
reductions are inadequate for the desired environmental outcomes (Walters and
Baird 2009). In regard to emission trading programs generally there has been
concern about the polluters being given the right to pollute at a price determined in
an unproven marketplace (Pearce 2003; Pearse 2010 and Beder 2009).
The methodology used benefits from a lengthy observation of the U.S. Acid Rain
Program (ARP) for SO
. It was thought that the principles of SO
emissions trading
would be applied directly to a trading program for CO
. It would seem that the
concept of interchangeably of design factors between SO
allowance trading and
allowance trading is credible. As many of the factors that were identified as
prominent in the SO
trading program do appear in the pilot programs for GHG
emissions trading.
Significantly for the U.S. SO
trading program there was a level of bipartisan support
across the major political parties in the U.S. More at question perhaps was the
limited use of market based environmental regulation that SO
emissions trading
introduced. In the U.S. before the ARP the Lead Trading Program (LTP) was a
ground breaking use of tradeable permits to manage the public health concern about
the lead content of gasoline. The impetus for cutting emissions from the ARP and the
LTP had a high public profile. In contrast, some countries perceive that the potential
damage from global warming does not yet appear to support the need for decisive
A factorial framework
In Australia Shergold (2007), the National Emissions Trading Taskforce (NETT 2007)
and later, Garnaut (2008), enhanced the literature with possible designs for a cap
and trade GHG emissions trading scheme. Submissions to the Garnaut Climate
Review included the Productivity Commission (2008) which stated that a credible
model should be a pure emissions trading scheme (ETS), one that shares the
burden for greenhouse abatement across as many sectors as possible. This data on
factors that appeared in proposals for an Australian GHG emissions trading program
have shaped the research process. What follows is a synthesis of the Shergold
report of 2007, the NETT report of 2007 and the Garnaut Review which was
released in 2008.
Areas of focus according to Shergold (2007) in a Prime Ministerial paper were price
caps, permit allocation, scope of the program and provisions for alternatives to
emissions reduction i.e. offsets. These basic elements were the focus points that led

to more detailed key features of the proposed scheme. These were the targets for
long-term emissions abatement which could facilitate a flexible overall emissions
trajectory (reduction target), also a forward pricing mechanism in the carbon market
and the maximum practical coverage for all sources and sinks. It was recommended
that permit liability be placed on large facilities and upstream fossil fuel suppliers,
along with the exclusion of agriculture and land-use emissions. To reduce the initial
negative economic impacts free initial allocation of single year permits, with periodic
auctioning of subsequent permits was the preferred path.
The report also detailed a carbon price safety valve, a wide range of carbon offset
regimes and the capacity for international linkages.
The NETT proposals were underpinned by: economy-wide coverage; stringent
monitoring, reporting and verification, strong disciplinary measures for non-
compliance; a transparent offset process; and a permit allocation that does not
compromise the schemes ability to achieve a GHG emissions reduction target
(NETT 2007). A summary of the NETT design criteria follows.
The NETT recommended governance structures that exhibited collaborative scheme
designs and a coherent climate change strategy. Under the NETT, sectoral coverage
would include the stationary energy sector, transport, energy intensive industry, and
fugitive emissions. A NETT-based scheme would have a cap (emission reduction
target) with suitable emissions reduction trajectories and annual permits to emit one
tonne of carbon dioxide equivalent (CO
The NETT also suggested the free allocation of permits to the stationary energy
sector and Trade Exposed Energy Intensive Industry (TEEII), with auctioning of
permits among other participants with a level of equity assistance to disadvantaged
parties, and compliance in the surrender of NETT permits and the NETT offset
credits, with offsets to include GHG reductions outside the NETT, as well as the
flexible Kyoto mechanisms of JI and CDM. The NETT recognised that complex
legislative measures would be necessary to facilitate implementation of the NETT.
Another fundamental requirement would be extensive processes for monitoring,
reporting, and verification. It proposed linking with international schemes,
complementary measures for agriculture, research into low-carbon technology, non-
monetary energy efficiency incentives, and climate change adaptation education.
The Garnaut Climate Change Review was established by the Australian government
to recommend medium to long term policy and policy frameworks that would shape a
response to climate change. The principles of design and intrinsic design features
below are adapted from the Emissions Trading Scheme Discussion Paper which
called for submissions on an Australian emissions trading scheme proposal. The
resulting principles shown below were established to guide design:

permit scarcity aligned with emissions target; i.e. demand drives the value
of permits. Tradability; characteristics of permits are clearly defined and
mechanism for trade is transparent. Credibility; faith in the enduring nature of
critical elements. Simplicity; rules are easily explained, concessions and
exceptions avoided. Integration with other markets; minimal distortions within
the domestic scheme relative to international markets. Coverage, offsets,
point of obligation, permit design, permit issuance, international trade and
(Garnaut 2008)
This review considered that external price control would be necessary to minimise
distortions in the market. The review supported inter-temporality: banking and
borrowing to help avoid trade distortions. It called for scheme reviews, strong
governance and stringent compliance driven by appropriate penalties.
In a synthesis of the data on market based environmental regulation a group of
factors that are important in terms of a standard scheme design have been identified
and are they are shown below.
Internal (operational) factors, from the evidence in the case studies these factors are
considered to be important for normal functioning of a program for emissions trading.
They are legislation, governance, rules, compliance and entry and exit provisions.
Also fundamental are the allowances to emit greenhouse gases. Aspects of which
can be taken to include their allocation, allowance price discovery, the treatment of
surplus allowances and allowances as a financial asset.
External (acceptance) factors, from the evidence in the case studies can be shown
to be less stringently applied and vary according to particular socio economic
characteristics of a region. This categorisation includes the targets for emission
reductions, complementary policy, scheme coverage and a phased introduction. In
the case studies, each region has a unique set of variable traits, e.g. existing
environmental priorities and a reliance on fossil fuels.
While the relative importance attributed to each of the factors considered in the
cases studies varies, it has been established that they can be categorised. Generally
it has been found that the first group of factors, i.e. legislation, governance, rules,
compliance, entry and exit provisions are related more to the internal operation of the
programs. While the second set of factors, i.e. allocation of allowances, surplus
allowances, financial asset, targets, complementary policy, coverage and a phased
introduction are considered to be generally more related to acceptance of the
program. Some factors also exhibit a dual role and can be considered to have
crossed the boundaries of both operation and acceptance.

The factors are shown in the table below in categories that are used for the purpose
of comparison in the research.
Table 1 Factors and the categories used for a comparative methodology in the research
Internally driven factors
Externally driven factors
Factors that appear in
both categories
Legislation Coverage Entry and exit provisions

Phased introduction Allocation of allowances

Allowances as a financial
Treatment of surplus
Compliance Targets Complementary policy

Using the factorial framework to compare SO
trading and CO
In an extension of the original research aims, factors seen as important in the US
Acid Rain Program (ARP) were tested for applicability in the GHG emissions trading
case studies. Each of the factors from the case studies is compared with the U.S.
ARP. This approach highlights the differences between the three programs for
emissions trading (US ARP, EU ETS & US RGGI). The distribution of the allowances
initially in the EU ETS was free of charge (grandfathered on historical emissions)
while from the outset of the RGGI all allowances were auctioned. In the case of the
U.S. ARP, the allowances were initially distributed free of charge.
The comparison has noted some similarities between the emissions trading
programs for both SO
and CO
, e.g. the sectors that were covered. In the U.S. ARP
stationary energy or large electric generators were covered. This was also the case
for the RGGI, although the actual numbers of generators covered was considerably
more for the U.S. ARP as it applied across all parts of the U.S. mainland. Other
similarities between the ARP, EU ETS and US ARP included a strong legislative
process, clear governance structures, transparent participant based reporting and a
phased introduction.
In the U.S.ARP and in the EU ETS, a pre-existing body acted in oversight of the
statutory elements of a novel program. In the case of the U.S. ARP the body was the
U.S. Environmental Protection Agency (EPA). While in the case of the EU ETS this
oversight was by the European Commission, for the European nations that were

participating. In the case of the RGGI a new body was established, RGGI Inc. to
cede down the macro level plan for emissions trading to a state based level.
In each of the programs the level of emission reduction targets varies considerably.
The U.S. ARP had aggressive reduction targets, whereas the programs for CO

were relatively benign. Complementary policies also seemed to reflect regional
differences especially the case of the U.S. ARP. The nature of the threat from the
deposition of acid was not evenly distributed across all the regions covered. As a
result additional rules were developed to cover this anomaly.
Complementary policy remains fundamentally important for GHG emissions trading.
This refers to alternatives such as energy efficiency rating carbon offset schemes or
mandated renewable energy targets. As suggested below these complementary
policies may introduce a perverse incentive to reduce the cost effectiveness of a
pure cap and trade regime.
Complementary policies, by contrast, designate in advance how greenhouse
gases (GHGs) must be reduced and the sources from which these
reductions must come. While complementary policies can effectively reduce
emissions, they also constrain the market options available under cap-and
trade by limiting the choices emitters have about how to reduce their
emissions. That constraint can lead to higher compliance costs.
(Carlson 2012)
The framework for the factorial analysis was developed in the early stages of the
research using data from prior tradeable permit programs. These programs ranged
from the Lead Trading Program that began in 1985 to later developments in United
Kingdom, other part of Europe and Australia. There are now further unique designs
for GHG emissions trading that have emerged, e.g. The New Zealand Emissions
Trading Scheme and Californian Emissions Trading Scheme.
The literature on tradeable permits and on GHG emissions trading has grown
considerably. Goulder (2013) suggests that the outcomes of cap and trade
emissions trading can also now be better understood in relation to other policies.
During its initial stages the US sulfur allowance program (SAP) was considered as
being successful in reducing the very visible impact of acid rain in the US
(Schmalensee Stavins 2013 and Ellerman et al 2000). The US EPA suggests that
under the ARP to 2010 SO
emissions from electricity generation plant have been
greatly reduced since the programs inception in 1995.
Prior research papers have suggested elements of the US SO
SAP would be
transferable to a program for GHG emissions trading. These include Chan et al
(2012), Hansjurgens (2011), Burtraw et al (2005) and Ellerman et al (2003). What

this literature also reveals are the design factors inherent in the U.S. ARP that
contributed towards its success. Evidence from Tietenberg et al (1998) and Stavins
(1998) identifies a short, but significant, list of factors to consider. Tietenberg
considered that emission caps, allowance trading, compliance and stringent
environmental standards are fundamentally important, to SO
emissions trading.
Stavins expands the category to include a phased introduction and cost
effectiveness in trade between facilities. Stavins acknowledges that the banking of
allowances is important as was the compliance encouraged by a US $2000 per ton
The phased introduction of SO
emissions trading was mirrored in the EU ETS in
particular. In the case of the US ARP a phased introduction relates to the targets for
emission reductions which became more stringent in a staged manner. It has been
noted by Stavins and others that the US ARP emission reduction targets were
achieved. He also felt that while the original motivation was the mitigation of acid
rain, human health improved as a complementary outcome.
As the experience with the US ARP and SO
emissions trading grew so too did the
level of understanding about the important elements of the program. As evidenced in
the literature by Ellerman et al (2003) and Burtraw et al, (2005) all of whom
contributed to a deeper understanding of the process. Noted in the contribution of
Ellerman et al (2003) is the success in lowering the cost of meeting emission
reduction goals and the enhanced achievement of environmental goals.
These authors also observed that allowances were clearly defined to allow trade
without case by case verification and that banking improves economic and
environmental performance. Their remaining observations related to the targeted
electricity sector, where there was verifiable measurement of emissions and the free
issuance of the majority of allowances. Ellerman et al (2003) also considered that the
allowance market was slow to develop due to external forces.
It was thought that the principles of SO
emissions trading may be applied to a
trading program for CO
. On comparison it does seem that the concept of
interchangeably of design factors between SO
allowance trading and CO

allowance trading is credible. As many of the factors that were identified as
prominent in the SO
trading program do appear in the two case studies described
by this paper.
It has been noted that the SO
trading program had some level of bipartisan support
across the major political parties in the US. More at question perhaps was the limited
use of market-based environmental regulation that SO
emissions trading
introduced. A precedent to the Acid Rain Program (ARP), the Lead Trading Program
(LTP) was a ground breaking and successful use of tradeable permits to manage an
airborne pollutant. The very real public health concern about the lead content of
gasoline was the principal issue in this case. This impetus for cutting emissions from

the US ARP and the LTP may have had a higher profile in terms of public
awareness. While the damage from global warming is it seems, at the time of writing,
settling into the mainstream consciousness it does not appear that there is the
perceived need for summary action.
There were also a number of factors from the evidence about SO
allowance trading
that did not show a strong correlation to the case study data. These were related to
the identification of positive environmental and health outcomes, establishing a base
case from which to assess cost effectiveness and substantial penalties for non-
This paper has identified a number of the flexible design decisions that are
fundamental to effective policy for GHG emissions trading. These include the
legislation, issuance of allowances, emissions caps and sectoral coverage. This
paper also introduces some factors that are growing in importance when
implementing programs for GHG emissions trading. These include the treatment of
allowances as a financial asset, the entry and exit provisions for new entrants and
retiring plant as well as the management of the associated allowances
As well this paper has raised questions about the wide variance of emission trends
for the participating countries and states in the case studies. In the EU ETS, while all
countries exhibited a downward trend in their emissions these emission reductions
varied from between 0.01 per cent and 31.34 per cent. In the RGGI the emissions of
five participating states declined while the emissions of the other five states
increased. This paper indicates an overall RGGI emission reduction of 0.8% over the
first control period. The force behind these divergent trends has not been explained
in the research.
Complementary emission abatement policy remains an area of importance given the
uncertainties attached to the future of GHG emissions trading in its own right. In
some cases complementary policies may introduce constraints in terms of what are
the most cost effective options to reduce emissions. Some popular but less effective
complementary policies may introduce perverse outcomes toward more cost
effective options for reducing emissions. Ongoing research would be helpful to
determine how complementary policies can best enhance the efficient operation of a
trading program.
The data used for the research on the EU ETS has been impacted by a period of
economic uncertainty that resulted from the global financial crisis (GFC) that took
effect in 2008. The trends of emissions covered by the EU ETS appear to have been
shaped by the external forces of the GFC. The effect that the GFC has had on
emissions intensity has been observed but is not well understood by this researcher.
As there is only limited academic research available in the prior literature on aspects

of this link. A deeper understanding of this important element was not within the
scope of the current research. This limitation to the research, i.e. the impact of
broader economic trends, leads to another direction for further research.
I am grateful to my principal doctoral supervisor Professor Peter Sheehan and also
Margarita Kumnick both from the Victoria Institute of Strategic Economic Studies at
Victoria University, for their helpful comments on the earlier versions of this paper.
As well additional comments from an anonymous reviewer have been considered in
the current version. Any errors or omissions are my own.
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The Political Economy of Renewable Energy Generation in
Jemma V. Williams
and Jeremy B. Williams

Fenner School of Environment & Society, The Australian National University,
Building 141, Linnaeus way, Canberra, ACT, 0200, Australia
Asia Pacific Centre for Sustainable Enterprise, Level 2, Sir Samuel Griffith Building,
Nathan campus Griffith University, 170 Kessels Road, Nathan, QLD, 4111, Australia
*Email:; Ph: 0413 046 253
As concerns about climate change escalate (IPCC, 2013), and the need for caution
over management of natural resource scarcity and energy security becomes more
evident, it is increasingly apparent that renewable energy generation must be utilised
to a far greater extent if well-being is to be enhanced within planetary boundaries. It
is not surprising, therefore, that questions are starting to emerge around how this
sustainable future might be realised, and what roles and responsibilities must be
taken by various actors within the political economy to provide the most effective
means of managing this transition. This paper makes the case for energy resilience;
one focusing not solely on the capacity to absorb shocks, but on the capacity for re-
organisation, and for innovation and development.
renewable energy; climate change; political economy; energy resilience
The Taxonomy of Climate Change
At a press briefing in February 2002, the United States Secretary of Defense, Donald
Rumsfeld, uttered the following words that earned him the 2003 Foot in Mouth
Award presented each year by the Plain English Campaign for a baffling comment
made by a public figure:
Reports that say that something hasn't happened are always interesting to me,
because as we know, there are known knowns; there are things we know we
know. We also know there are known unknowns; that is to say, we know there
are some things we do not know. But there are also unknown unknowns; the
ones we don't know we don't know.
Coming at the height of the controversy surrounding weapons of mass destruction
(WMD) in Iraq (or lack thereof), Rumsfeld was roundly criticised for this seeming
abuse of the English language, and what was deemed to be deliberate obfuscation

of the facts. Whether his choice of words was motivated by political expediency or
not, this style of communication is not likely to win many admirers among the media
or the general public at large. As a taxonomy for categorising information, however, it
is quite serviceable, especially when contemplating the knowns and unknowns about
climate change.
Anthropogenic Global Warming: A Known Known
While the climate science community has been quite resolute in its stance that global
warming has been accentuated by human activity in the post-industrial era the so-
called Anthropocene one could be forgiven for thinking that the jury is still out given
the way this subject is presented in the popular media. The notion that there is some
controversy over human-induced climate change flies in the face of the received
wisdom. Indeed, a number of academic surveys of climate scientists and the
scientific literature have consistently shown there to be a resoundingly large
consensus on the existence of anthropogenic global warming (AGW) including, for
example, Anderegg et al. (2010), Doran and Zimmerman (2009), and Oreskes
(2004), all of whom cite figures in excess of 95 per cent. More recently, Cook et al.
(2013) surveyed the abstracts of 11994 scientific papers between 1991-2011 the
largest peer-reviewed study to date and of those who stated a position on the
causation of global warming (around one third), more than 97 per cent endorsed the
view that humans are to blame.
In Rumsfeldian terms, AGW is a known known. Some might continue to claim that it
is a known unknown, but when there is such a resounding majority of scientists in
agreement, any rational and objective observer would consider this position
untenable. Indeed, in the Fifth Assessment Report of the Intergovernmental Panel on
Climate Change, there is 95% confidence that human-emitted greenhouse gases are
responsible for climate change (IPCC, 2013). This is the same level of certainty that
scientists have about cigarettes causing cancer. Who, for example, on being advised
by a medical professional that they have cancer, would get 94 more opinions, all of
which confirm this diagnosis, only to accept the opinion of the 96
doctor who
advises that they are perfectly healthy?
Far too much time has been wasted debating the existence of human-induced
climate change, to the point where urgent action is now required. To continue to
deny AGW would be to identify with a fourth category not acknowledged by
Rumsfeld; viz. the unknown known, that which we intentionally refuse to
acknowledge that we know (iek, 2004).
The Carbon Budget: A Known Known
Perhaps the most significant known known to emerge in recent years is the carbon
budget. Commencing with the work of Meinshausen et al. (2009), it was determined
that in order to limit global warming to 2
C above pre-industrial levels the

agreement adopted at the United Nations Climate Change Conference in Cancun,
Mexico, in 2010 then the global carbon budget for 2000-2050 must not exceed
886Gt of CO
if the chances of going over 2
C were to be reduced to 20% (see
Figure 1, reproduced from However, deducting emissions from
the first decade of this century leaves a budget of only 565Gt of CO

Figure 1. The remaining carbon budget for an 80% and 50% probability of keeping warming
to below 2C
Campanale and Leggett (2011) took this analysis a step further when they calculated
that the declared reserves of fossil fuel companies around the world are equivalent
to 2795Gt of CO
. What this means, as Bill McKibben pointed out in his now famous
article in Rolling Stone magazine, is that fossil fuel companies have five times more
carbon in their reserves than even the most conservative governments think would
be safe to burn (McKibben, 2012). Put simply, to stay within 2
C warming, 80 per
cent of fossil fuel reserves cannot be used.
One of the most significant things about this turn of events is that no one is
disagreeing with Meinshausen and his colleagues. Published in Nature, one of the
most respected scientific journals, the paper is in the top 0.1% of cited environmental
papers in the world, and its results are widely accepted by the scientific community.
Most telling of all is the complete silence from the fossil fuel industry.
The financial community, on the other hand, has not been so quiet. The HSBC bank
in London has warned of the bursting of the carbon bubble that could nearly halve
the value of coal assets on the London exchange, and reduce the value of oil and
gas companies by three-fifths. In Australia, John Hewson, the former leader of the
Liberal Party, has launched the Asset Owners Disclosure Project (AODP), and has
pointed out that the average pension fund invests about 55 per cent of its portfolio in
high-carbon intensive industries and only 2 per cent in their low carbon counterparts,

meaning they are ill-equipped to manage the risk of catastrophic climate change
going forward (Green, 2013). Lending support to his argument, a group of 70 global
investors in the United States and Europe managing more than US$3 trillion of
collective assets has launched a coordinated effort to cajole 45 of the worlds top
fossil fuel and energy companies to assess the financial risks that climate change
poses to their business plans.
This represents a watershed in the policy debate about climate change because the
environmental movement has found important allies within the mainstream. Aside
from the investment community, even those closely connected with the fossil fuel
industry are speaking out. A former chairman of the Australian Coal Association, Ian
Dunlop, has accused the fossil fuel industry of stuffing up effective action on climate
change, and has argued that there needs to be an urgent transition away from
carbon-intensive fuels (Milman, 2013).
In May 2013, a grim milestone was reached when, for the first time in at least
800,000 years, atmospheric concentrations of CO
reached 400 parts per million
(ppm) (Gillis, 2013). Bill McKibben and campaign for what they consider the
safer option of 350ppm. The governments signing up to the Cancun Agreement have
accepted a limit of 450ppm which according to Meinshausen et al. (2009), provides
only a 50% chance of climate stabilisation at 2
C warming.
Acknowledging known knowns on climate change seems to present a problem for
some governments around the world, not least the recently elected Coalition
government in Australia whose leader, Tony Abbott, once dismissed climate change
as absolute crap. Mr Abbott has softened his position since but the early signs are
that the new government will wind back many of the initiatives taken by the previous
government to combat climate change.
While this may be worrying for some, the weight of evidence will inevitably prove too
overwhelming even for the most recalcitrant of governments, and when this
happens, market forces will take over. Indeed, there are signs this is happening
already. Analysis from research firm Bloomberg New Energy Finance (BNEF) has
concluded that electricity from unsubsidised renewable energy is already cheaper
than electricity from new-build fossil fuel-fired power stations in Australia. As Figure
2, illustrates the price of photovoltaic cells has dropped dramatically. Companies
such as Ratch Australia, which owns coal, gas and wind projects, has indicated that
the cost of new build solar PV is already around $120-$150/MWh and falling at such
a rate that it is considering replacing its ageing coal-fired Collinsville power station
with solar PV. Wind power, meanwhile, according to modelling from BNEF, is
already significantly cheaper than fossil fuel generated power, with new wind farms
supplying electricity at a cost of $80/MWh, compared with $116/MWh for new build
gas-fired generation and $143/MWh for new build coal-fired plant. Removing the
carbon tax closes the margin, but wind still remains 14% cheaper.

Figure 2. Alternative energy will no longer be an alternative, Source: The Economist, 21
November 2012
In the United States, companies are going a step further, and actually unplugging
from the grid to generate their own power. Writing in The Wall Street Journal, Smith
& Sweet (2013) reports that the number of electricity-generation units at commercial
and industrial sites has more than quadrupled since 2006, from around 10,000 to
40,000. The falling price of solar panels is one factor, but so is the fear of power
outages because of the increasing frequency of major storms. The chief executive of
American Electric Power (AEP), a large Ohio-based utility, is quoted and not wanting
to end up as a caretaker of a museum, and AEP is getting in on the business of
helping customers install their own generating facilities. On-site generation still
accounts for less than 5 per cent of total US electricity production but some of the
companies are close to the point where they will have grid parity, where power
would be as cheap to make as to buy from a utility.
Australias Clean Energy Future
In the Australian context, public policy to encourage the uptake of renewable energy
is obviously highly desirable given the dwindling carbon budget, and the Clean
Energy Future (CEF) package introduced in November 2011 was a step in the right
direction in this regard. The CEF plan outlined a set of measures designed to reduce
Australias green house gas (GHG), and to encourage the development of a more
sustainable energy sector. The central components of this package included
introducing a price on carbon dioxide

emissions, encouraging energy efficiency,

creating opportunities in the land sector to reduce GHG emissions, and promoting
innovation and investment in renewable energy. This package was widely viewed as
representing an opportunity for a fundamental transition towards a low carbon
economy, most notably in the electricity industry (Commonwealth of Australia, 2011).
With the election of the Coalition government in September 2013, elements of the
CEF are in the process of being dismantled including the Clean Energy Finance
Corporation and, in all likelihood, the price on carbon. The new governments plan is
Direct Action which, to date, has not won too many plaudits from economists who
typically favour market-based instruments to induce behaviour change. Instead,
Direct Action uses taxpayer funds to pay polluters to start reducing emissions and to
finance other initiatives such as forestry, carbon capture, and recycling. This kind of
government interventionism has not been in vogue particularly on the conservative
side of politics for quite some time as free market economics has been the
dominant ideology.
It remains to be seen, however, just how interventionist the government is prepared
to be. If the transition to renewables does not progress quickly enough for Australia
to stand by its international commitments to restrict global warming to 2
C, will the
Direct Action policy become more command-and-control and force fossil fuel energy
generators to limit their emissions? This, for the time being, is a known unknown.
Issues relating to climate change policy are typically wicked problems (Rittel &
Webber, 1973) in that they are commonly multi-dimensional and an effort to solve
one component of the problem can cause other problems to arise. Thus, in
acknowledging the intractability and ubiquity of the problem, those charged with
solving them can be prompted to change their approaches. This phenomenon has
been observed in a recent case study analysis of the CEF package (Williams, 2013).
In this study it is suggested that if there is to be an expansion of renewable energy
beyond some minimum threshold, further efforts are required to focus on the existing
barriers that are institutional and socio-cultural in nature. In the words of the IPCC,
barrier removal includes correcting market failures directly or reducing the
transactions costs in the public and private sectors by, for example, improving
institutional capacity, reducing risk and uncertainty, facilitating market transactions,
and enforcing regulatory policies (IPCC, 2007: 77). Few advocates of the CEF
package would disagree with this, but while efforts to remove the aforementioned
barriers would likely make CEF more effective in the expansion of renewable energy,
in keeping with the nature of wicked problems, the scope of the CEF plan in 2011
was not as broad as it needs to be in 2013. In the intervening period, the consensus
among climate scientists has grown stronger, and the nature of the problem has
become more quantifiable in that the issue of the carbon budget now demands
inclusion in the policy debate as data analysis has become more refined.

Discussion of how subsequent policies might be designed to remove barriers limiting
the effectiveness of renewable energy initiatives in the future must therefore not just
focus on the barriers themselves, but how quickly these barriers can be removed in
order to meet a renewable energy target (RET) consistent with a carbon budget that
meets Australias international obligations of managing climate change. In short,
Williams (2013) suggests that if global warming is to be contained there is a need for
business to function within a safe operating space of a two-degree pathway.
A Future for Renewable Energy Generation
Future policy design however, also needs to consider another known unknown; the
question of what the future energy mix will look like. Current trends indicate that
although we come from an inflexible energy past, we are now moving towards a
flexible energy future. This sentiment lends support to the position that policy
responses need to adopt a more adaptive approach, consistent with a carbon budget
that meets Australias international obligations of managing climate change. In this
respect, there would appear to be a strong case for building flexibility into the
structures and processes of institutions (Folke et al., 2005).
In keeping with an adaptive approach to energy governance, it would be prudent to
maintain an energy portfolio that is resilient and naturally equipped to adapt to
shocks. Most asset portfolios are subject to fairly high degrees of uncertainty, yet
businesses have developed strategies to maximise the benefits derived from these
assets (Costanza et al., 2000). An energy portfolio can be achieved through a
diverse range of energy generation. To manage risks appropriately within a rapidly
changing market, each technology is assessed on its costs, benefits and
uncertainties. Each technology has different energy characteristics to meet demand.
For example, coal is well equipped to accommodate base load generation, yet it
requires 15 years of operation before there is a return on investment (Parkinson,
2013a). By comparison, solar is fast to deploy, cost efficient, has a low distribution
cost, and also deals with demand side management. However, at this point in time,
the conventional wisdom is that it is not so well equipped to deal with base load, due
to intermittency in supply. The likes of Elliston et al. (2012) would likely contest this
Parkinson (2013b) notes that the International Energy Agency (IEA) has indicated
that liberalised energy markets like the National Electricity Market (NEM), should be
able to encourage a significant decarbonisation of the energy mix. A problem
hindering such decarbonisation is the configuration of the current energy markets
where the energy grid infrastructure favours the incumbent centralised fossil fuel
generators over more decentralised renewable energy generation. This arrangement
is not conducive to the delivery of the necessary energy transition required to stay
within 2C warming, and for Australia to meet its international obligations that it was
signatory to at the United Nations Framework Convention on Climate Change in
Cancun, Mexico in 2012. Part of the problem, Parkinson (2013b) explains, is that

these markets are designed to allow base load fossil fuel generation to continue at
little to no cost, in order to ensure that demand is met.
Radchik et al. (2013) offer an approach to deal with this challenge drawing on the
concept of the Virtual Generator; a contractually joined entity that is able to
guarantee reliable base load generation. This means that geographically separated
intermittent generators like a solar powered generator and a wind powered
generator, can be linked to a non-intermittent generator, such as a gas-fired power
station, and are treated collectively as a base load generator. The centrally
controlled Virtual Generator requires the intermittent generators to provide power
where possible and the gas generator compensates to accommodate for any
shortages in output due to a lack of wind, nightfall and random clouds blocking
sunlight (Radchik et al., 2013). In order to ensure a fast transition towards a
decarbonised energy sector, this approach could be complemented with a national
feed-in-tariff (FIT) to provide an incentive for transition, as well as to create a
guarantee in the initial stages of implementation, that these Virtual Generators will
receive a premium for the energy generated.
The challenge now, is how to speed up the transition, and do this efficiently and
effectively, minimising the likelihood of economic and social disruption. Centralised
institutions constrained by short-term political cycle and adopting a top down
approach to policy are ill suited in addressing emissions reduction for wicked
problems such as climate change (Folke et al., 2005).
Mitigation needs to be responsive to change and uncertainty regarding future
developments (Nursey-Bray, 2010), including, for example, being responsive to
technological innovation and development. Although a lot of work on resilience has
focused on the capacity to absorb shocks and maintain function, attention also
needs to be paid to another aspect of resilience; that concerned with the capacity for
re-organisation and development (Gunderson & Holling, 2002). In a resilient system,
disturbances have the potential to create opportunity for new things, for innovation
and for development. Moreover, a system may need to change its fundamental
behaviour quite suddenly. This is an important consideration if Australia is to stay
within a 2C pathway.
Jemma Williams recently completed a Bachelor of Development Studies at the
Fenner School, Australian National University, graduating with First Class Honours.
Jeremy Williams is Professor and Director of the Asia Pacific Centre for Sustainable
Enterprise in the Griffith Business School at Griffith University.


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Practitioners Perspectives

The Emissions Reduction Fund: a critique
John Hawkins

ANZSOG, Australian National University, Australia
* Email: ; Ph: +61 2 6125 3307
The Abbott Governments response to the problem of climate change is the direct
action proposal, a fig leaf to cover the gap left by their planned abolition of the
carbon price. Its main component is an emissions reduction fund which will be used
to pay firms tendering to reduce their CO
emissions below business as usual
levels. No credible experts believe the $1.1 billion over four years allocated in the
budget will suffice to reduce emissions to anywhere near the promised 5 per cent
(from 2000 levels) by 2020, let alone the much larger reductions which would
represent Australias fair contribution to limiting global warming. Even were it better
funded, the current sketchy version of the scheme, changed quite a deal from that
taken to two elections, is still flawed in many ways. It fails to limit emissions. By only
offering five-year contracts it will not affect long-term investment decisions. Taxes
are higher so as to pay polluters. Past bad behaviour is rewarded and administrative
expenses will be very high. Unsurprisingly, the overwhelming majority of economists
oppose it.
emissions reduction, direct action, climate change
The emissions reduction fund (ERF) is the main element
of the Abbott
Governments so-called direct action approach, which the Government (2014, p 1)
claims will reduce Australias greenhouse gas emissions to meet its target of five
per cent below 2000 levels by 2020".
The Government claims it can achieve this
reduction without a carbon price through a competitive grant programme' whereby
companies submit 'tenders' for actions that reduce greenhouse gas emissions and

The million solar roofs component of direct action has been quietly abandoned. The remaining
components are described in Coalition (2010, pp 23-30).
The Department of the Environments website (accessed 7 November 2013) says Australia will,
under the Cancun agreements unconditionally reduce its emissions by 5 per cent and by up to 15
per cent if there is a global agreement involving major developing countries commit to substantially
restraining their emissions and advanced economies take on commitments comparable to
Australias. The Climate Change Authority (2014) says these conditions have been met but the
Government never refers to this 15 per cent target.
the government pays those companies making the lowest bids (per tonne of

This model of paying polluters is an unusual way of addressing a policy problem. It is
akin to trying to reduce theft by paying burglars who promise to steal less, to prevent
terrorism by paying extremists who promise to let off fewer bombs than they
currently intend or to reduce lung cancer by paying heavy smokers who promise to
smoke less.
Furthermore, there remains much scepticism about the sincerity of the Governments
commitment to addressing climate change. Mr Abbott notoriously described the
science of climate change as absolute crap in 2009.
More recently he said of coal
mining that I can think of few things more damaging to our future than it being left in
the ground
when the scientific consensus is that to limit global warming to
acceptable amounts, most of the fossil fuel reserves must stay in the ground.

Minister Hunts Business Advisory Council
includes climate change delusionists
such as Dick Warburton
and Hugh Morgan
and others with little understanding of
the economics of carbon pricing.
Mr Abbotts own Business Advisory Council is
headed by another climate change delusionist, Maurice Newman.

The Liberals did not promote direct action with any enthusiasm at the 2013 election,
not even bothering to update the written version from the 2010 election and dropping
it off their website. In January 2013 the Coalition released a 50-page document

As Greg Hunt put it; "the [Coalition] government will simply buy back the lowest cost abatement";
opinion piece in Australian Financial Review, 24 October 2011, p 55. As Tony Abbott put it, "you go to
the market and you say look, we are looking to buy cost effective emissions reductions"; interview
with Ian Henscke, 7 March 2011, Tony Abbott's website.
At a public meeting in rural Victoria; Stuart Rintoul, The Australian, 12 December 2009. Interviewed
on the ABCs Four Corners, Mr Abbott said Um, I, I have pointed out in the past, ah that ah, there
was that high year um, a few years ago, ah, and the warming ah, if you believe the various measuring
ah, organisations, ah, hasn't increased. Asked about the IPCC report he said I certainly think that
there is a credible scientific counterpoint; Four Corners, 16 August 2010. Addressing pensioners in
2011, Mr Abbott described the 5 per cent emissions reduction target in the direct action plan as
crazy; Sydney Morning Herald, 19 July 2011.
Tony Abbott, address to Annual Minerals Industry Parliamentary Dinner, 28 May 2014.
Steffen and Hughes (2013, p 4).
Greg Hunt, media release, 10 May 2011.
See, for example, his article in Quadrant, March 2011.
Hugh Morgan was president of the climate change denying Lavoisier Group;
Kate Carnell claimed that the impact of the carbon price on consumer prices would be 3 to 5 per
cent; Meet the Press, 29 May 2011. The actual increase was 0.7 per cent or less.
Mr Newman has described the science of climate change as somewhat in tatters and called
subsidies for renewable energy a crime against the people; Lenore Taylor, Guardian Australia, 16
June 2013. He has described rising global temperatures as a climate change myth; Australian
Financial Review, 17 September 2013.
called Our Plan: Real Solutions for All Australians, which allocated one paragraph to
direct action.

It is unsurprising that some Coalition ministers were not keen on promoting direct
action as they know it is an inferior approach to a carbon price. As Greg Hunt said in
his thesis: the market system is a preferable regime, as it better ensures that the
polluter bears full responsibility for the cost of his or her conduct.
Mr Abbott and
his mentor John Howard have both lauded emissions trading schemes as superior to
alternative approaches in the past.

As detailed below, the plan has changed a lot between the version presented at the
2010 and 2013 elections and that in the White Paper, notwithstanding the claims by
Minister Hunt that we haven't changed our system since day one. So, over three
years we've been completely consistent.
But it remains the case that few
Australians could explain it in detail, for the simple reason there is no detail.

The Government hopes its tendering scheme could put a 'price' on carbon and lead
to the least expensive abatement projects going ahead. There are however many
implications of such a scheme that have not received much public discussion
, but
which raise doubts about its effectiveness and fairness and may erode support for
such a scheme;
a company that has been operating inefficiently and polluting a lot has much
more scope to put in a tender than a responsible firm that has already taken
action to minimise its emissions. The scheme therefore penalises past good
behaviour and rewards bad behaviour;
the scheme requires the government to raise more tax revenue than it would
otherwise need and then make payments to polluters. It therefore increases the
'churn' in the tax system. Those concerned with efficiency costs from taxation
should prefer a scheme where a carbon price replaces some income tax

There is scant reference to the ERF in Mr Abbotts recently released volume of speeches, A Strong
Australia. According to one count, carbon tax is mentioned over 106 timesDirect Action is
mentioned just six times; Minister for Climate Change media release, 28 November 2012. The
Liberals think tank the Menzies Research Centre, recently released a book, State of the Nation,
which did not regard climate change as meriting an entry among the 15 policy areas covered in
essays, the only reference to reducing emissions being denouncing the carbon tax in the essay on
resources policy, on the grounds it displeased the coal industry; Markwell et al (2013, p 8). Similarly,
a recent book of essays by Liberal intellectuals called Future-Proofing Australia has an essay on
protecting the mining industry, but not an essay on climate change, relegating it to a brief reference in
an essay on water.
Greg Hunt and Rufus Black, A tax to make the polluter pay,
See Hawkins (2014, pp 21-22).
Lateline, 18 April 2013. He made similar remarks in his speech to the Sydney Institute, 30 May
2013 and an interview with Latika Burke on ABC 24 on 17 July 2013.
Former independent MP, Rob Oakeshott, (2014, p 343).
One exception is speeches by Greens leader Christine Milne, such as Milne (2013).
collections (as is the case with the Clean Energy Future package the previous
governments carbon pricing mechanism);
the cost of the scheme is borne by taxpayers and the benefits are received by the
it gives no incentives for consumers, and firms not making successful tenders, to
seek out ways of using energy more efficiently and provides little encouragement
for the development of renewable energy; and
as it only runs to 2020 it does not provide incentives for longer-term measures.
Following the September 2013 election, Mr Hunt set out a programme of the scheme
starting on 1 July 2014 at the same time as the carbon price is removed.
supportive parliament might have allowed this timetable. But as of early June 2014
the current Senate has neither abolished the carbon price nor passed any supporting
legislation to establish the ERF. A Senate committee recommended against the
It remains to be seen what attitude the incoming Senate takes after July.
Mr Abbott has said he would proceed to a double dissolution if he does not get his
way, but this requires the Senate to reject the bills twice with at least three months in
between, pushing the earliest date for a double dissolution out to late 2014 at the
Following a second election, it may then be necessary to hold a joint sitting
for the legislation to be pushed through. All this would probably push the starting
date into the second half of 2015. By this time the current scheme would be within
months of transitioning into an emissions trading scheme with a (probably much
lower) market-determined rather than fixed price (and so no longer be a so-called
carbon tax).
The Government has marketed direct action as an alternative to the current
emissions trading scheme it has vilified. Ironically, in a speech to parliament in
February 2009, Mr Hunt described direct action as modelled on the NSW
Governments Greenhouse Gas Abatement Scheme, itself an emissions trading

Practical details of the Governments plan
The Coalition (2010, p 14) has described their plan as involving "businesses
reducing their emissions below their individual baseline ('historical average')". In the
White Paper it was revealed that baselines would be based on the highest annual
emissions from the years 2009-10 to 2013-14, calculated from reports under the
National Greenhouse and Energy Reporting Scheme (NGERS) and that baselines

Greg Hunt, media release, 16 October 2013.
The Senate Environment and Communications Committee (2014a, p 99) recommended that the
Emissions Reduction Fund not be substituted for the carbon pricing mechanism.
Greg Hunts claim that there would be an immediate double dissolution if the repeal of the carbon
price is rejected was clearly impossible. His claim was in Hunt (2012b); interview on Sky Agenda, 1
July 2012 and The Drum, 11 January 2013.
An irony noted in Rob Oakeshott (2014, pp 158-9).
would be based on emissions intensity (emissions per unit of production), implying a
firm could receive funding while actually increasing their absolute emissions.

Businesses not currently reporting under NGERS will also be able to bid, but it is not
clear how their baselines will be assessed. Nor is it clear how a new firm would be
treated as they do not have a baseline to go below. Some companies may have
substantially changed the nature of their operations, selling or buying individual
plants or changing what they produce, which would make their baselines misleading.
The bids have to be for projects that would not otherwise proceed. This creates a
serious problem for a firm that submits an unsuccessful bid to reduce emissions. It
then cannot later undertake that action that would reduce emissions because that
could be seen as indicating it had made a false claim in its bid. So the scheme will
actually prevent many firms from reducing emissions.
The auctions will be held quarterly, so long as the number of registered bidders
exceeds an unspecified minimum, with a minimum bid size of 2,000 tonnes per
The White Paper refers to a benchmark price for each auction, above which
bids will not be considered which will generally be unpublished and calculated in a
non-transparent manner,
thereby adding another complication and uncertainty to
the bidding process.
Even after the release of the White Paper, there are many aspects remaining
unclear. The White Paper refers to project risk and commercial readiness being
assessed in the pre-qualification phase
but what does this actually mean? Is
there some threshold of riskiness beyond which projects will not be considered? Will
there be any time period within which successful projects must commence?
unsuccessful tenderers have any avenue for appeal? There are also vague
provisions for large projects to be awarded contracts on an out-of-auction basis.

The scheme does not provide the certainty that business claims they need to make
their investment plans. Most obviously, firms will not know whether their bid will be
successful. But also the scheme will be reviewed and possibly revised in 2015.
Malcolm Turnbull put it, "it can be easily terminatedIf you believe climate change is
going to be proved to be unreal, then a scheme like that can be brought to an end".

Australian Government (2014, p 31).
Australian Government (2014, p 45).
Australian Government (2014, pp 11, 44).
Australian Government (2014, p 42).
This is particularly an issue as an ANAO study found that previous competitive grant schemes took
significantly longer to achieve any abatement than originally planned; Denniss and Grudnoff, (2011, p
Australian Government (2014, p 48).
Australian Government (2014, p 15).
Malcolm Turnbull, Lateline, 18 May 2011.
Another source of uncertainty for business is that the Governments plan only runs to
2020, and only offers contracts running for five years, notwithstanding Mr Hunts
claim that it is a 20 year system.
As Malcolm Turnbull has commented; "because
most capital equipment, especially in the energy sector, has a life running into many
decades, as long as 50 years in some cases, the business sector is going to require
assurance that any government subsidy will match the life of the asset so running
well beyond 2020If government wants business to make long-term investments to
lower emissions, its commitment must be long term as well, which is why a subsidy
scheme which terminates in 2020 will achieve very little."

Is the ERF adequately funded to achieve claimed emissions reductions?
The Coalition (2010, p 13) initially said the ERF would cost $2.6 billion over 4 years,
and an average of $1.2 billion per year through to 2020 (Table 1).
If the cost
increased roughly linearly over time, this would imply a cost of around $2 billion a
year by 2020.
The estimated cost over the first three years was remarkably
constant from 2010 to 2013 despite variations in actual emissions and the carbon
price in overseas schemes. Suddenly in the 2014 budget, the cost has dropped
markedly. The explanation given was that, as the scheme was payment on delivery,
the payments would not occur until well after the tenders were awarded. It is not
clear why this was only suddenly realised at the time of the budget.
No explanation
was given as to why the medium-term cost of the scheme has dropped from almost
$11 billion to under $3 billion.
No explanation has been given of who prepared the initial costing or the basis of the
calculation. It implied a cost in 2020 of at most $14 per tonne ($2 billion/140 million
tonnes) to cut emissions (assuming all the cost goes to payments, although as noted
below the administrative costs will be large).
This has always seemed optimistic;
the Labor Government's scheme started with a carbon price of $23 a tonne and Mr
Hunt is not claiming that it is massively overachieving on emissions reduction. The

7.30, ABC TV, 15 July 2013.
Malcolm Turnbull MHR, House of Representatives Hansard, 8 February 2010, p 581. The five year
limit has been widely criticised; see Senate Economics and Communications References Committee
(2010a, pp 112-114).
Mr Abbott agreed the cumulative cost would be around $10.5 billion by 2020; interview with Chris
Ullmann, 7.30, 4 July 2011, ABC website.
$2 billion was also Malcolm Turnbull's estimate of the cost in 2020;
The payment on delivery approach also means that the scheme no longer helps firms meet the
cash flow requirements of taking action to reduce emissions, notwithstanding Mr Hunts (2012a)
earlier claims that many industries face substantial capital expenditure costs in reducing their CO

emissions and that under his scheme the capital will be available for business to conduct emission
reduction activities.
Minister Hunt has publicly referred to a cost of $15 per tonne; ABC 24, 18 May 2011, cited in
Government is relying on soil carbon to achieve a large proportion of the reduction in
emissions at a very low cost but this is very doubtful.

Table 1. Comparison of the reported cost of the Emissions Reduction Fund ($ million) from
2010 to 2014
year 2
year 3
year 4
year sum Up to 2020
Original proposal (2010) 300 500 750 1000 2550 10800
2014-15 2015-16 2016-17 2017-18 Over 10 years
Green paper (2013) 300 500 750
MYEFO (December 2013) Included in contingency reserve
White paper (April 2014) 300 500 750 1000 2550
Budget (May 2014) 76 300 355 417 1148 2550
Sources: Coalition (2010, pp 13, 30); Australian Government (2013, p ); Mid-Year Economic
and Fiscal Outlook 2013-14, p 64; Australian Government (2014, p ); 2014-15 Budget Paper
No 2, p 102; 2014-15 Budget Overview, p 27.
Nor has any modelling underpinning the cost estimates in the budget, or the
estimated amount of emissions reduction they would achieve, been released.
Senator Birmingham, the parliamentary secretary, was asked at the recent Budget
Estimates eight times to release any modelling and replied seven times that he was
confident that the targets would be met but he would not say whether there had
been any modelling done.

Minister Hunt has been emphatic about the costings, referring to them as fixed,
capped costswe will not spend a dollar more.
This seemed an extraordinary
degree of confidence about the outcome of an auction to be held months or years
away. During the latter stages of the 2013 election campaign Mr Abbott was clearer,
saying that if the available funds proved insufficient to buy emissions reductions of 5
per cent, then the promise on emissions would just be abandoned rather than
additional funding being provided.
If, as Mr Hunt used to imply, the estimated cost is a fair estimate of the likely cost of
the successful bids, this means there is a 50 per cent chance that the cost of
achieving the emissions goal would exceed this, and therefore Mr Abbott and Mr
Hunt are effectively saying there is at least a 50 per cent chance that the Coalition
will break their promise on emissions reduction.

See Hawkins (2014, pp 14-16) and the references cited therein.
Senate Environment and Communications Legislation Committee (2014b, pp 74-75).
Minister Hunt, interview with Kieren Gilbert, Sky News, 12 February 2013.
There are a large number of studies which find that the funds allocated to the ERF
will not be sufficient to achieve the 5 per cent emissions reduction aspiration once
the carbon price is abolished. The Climate Change Authority (2014, p 8) has
predicted that in the absence of a carbon price or other effective policies, emissions
are expected to grow to 685 Mt CO
e in 2020, 17 per cent above 2000 levels.
When the Department of Climate Change (2010a, b) assessed the direct action
scheme, it found "the costs claimedvery difficult to support on the basis of relevant
experience". If expenditure on the scheme were capped at the $1.2 billion a year
average up to 2020, as set out in Coalition (2010, p 13), the Department of Climate
Change (2010, p 3) estimated, based on 'multiple estimation methodologies' that
emissions in 2020 would be 13 per cent above 2000 levels rather than 5 per cent
below. The amount now proposed to be allocated is much less than the $1.2 billion a
year average used in this calculation.

Treasury commented in its 2010 incoming government brief that "the mitigation task
to achieve your commitment to reduce national emissions to 5 per cent below 2000
levels by 2020 is significant. It cannot be achieved without a carbon price if
damaging economic and budget impacts are to be avoided. Direct action initiatives
alone will not do the job."
Treasury has refused to release its 2013 incoming
government brief.
The Senate committee reported that an overwhelming number of submissions and
witnesses expressed doubt about whether the Direct Action Plan and the ERF could
achieve Australias existing emissions reduction targets.
Reputex Carbon (2013, p
5) estimate that under the ERF emissions would increase by around 16 per cent by
The head of the Australian Renewable Energy Agency said the amount of
abatement that could be directly purchased is going to be, in my own view, way, way
less than Greg Hunt would likeI think direct action will fall at the first hurdle and be
seen enormously wanting.
Experience with similar schemes also suggests that the
Coalition plan is under-funded.
Even the Institute of Public Affairs, normally strong

Similarly, a costing of direct action by government departments in 2013 suggests that its costs over
the forward estimates period would be around $13 billion more than the Coalition asserts. Even that
costing is regarded as a lower bound, as it is extremely unlikely that a grant tendering scheme would
yield lowest cost abatement; Minster Wong, Opposition budget 2013, 3 August 2013.
Department of the Treasury,
1442/ p 10.
Senate Environment and Communications References Committee (2014a, p 77).
An analysis by the Climate Institute (2013) and Sinclair Knight Merrtz (2013) suggested that direct
action would fail to achieve emissions reductions if the cost is limited to the caps set by the Coalition;
and an additional $4 billion would be needed to achieve the 5 per cent emissions reduction. The
analysis, however, is based on unreasonably favourable assumptions. In particular it assumes that
the companies submit bids reflecting their costs of abatement rather than a market clearing price.
Mr Greg Bourne, quoted in Australian Financial Review, 28 May 2014, p 5.
A Grattan Institute study examined 300 policies and programmes within Australia since 1997 aimed
at reducing emissions and concluded "analysis of a range of grant-tendering programsshows that
they cannot reduce emissions at the necessary scale or speedBased on experience, government
would need to announce an abatement purchasing fund of $100 billion to meet the 2020 emissions
supporters of the Government, are sceptical, saying "it would be very difficult for it to
achieve its goals".

Some optimists about the cost of reducing emissions point to research by McKinsey
consultants on the cost curve. It shows that some reductions in emissions,
especially through energy-efficiency measures in buildings, are costless and others
are low cost.
But it is surprising that firms are not already planning to undertake the
costless emissions reductions programmes and the ERF is not meant to pay firms
for activities they would undertake anyway.
A big problem for such a tender system is that even if some firms could afford to
tender at very low prices, they will not do so when they expect that higher prices will
still be winning bids. The Department of Climate Change (2010a, p 21) observed that
in practice in multi-round environmental tenders in Australia and internationally,
quickly bids converge to close to the highest bid from previous rounds.
As one
commentator put it Its like when you offer your house for sale. You dont price it
based on what you paid for it but what people are currently paying for similar
houses in the surrounding area.

Furthermore, as the Department of Climate Change (2010a, p 11) have pointed out,
community perceptions of fairness may make it difficult to maintain large differences
in the price paid for abatement projects (for example by paying farmers a different
price for land management activities than provided to power generators for a change
in the fuel mix).
The cost of achieving reducing emissions equivalent to cutting Australias domestic
emissions to 5 per cent below 1990 levels could be lowered substantially if some of
the abatement was purchased abroad.
But the Coalition opposes any purchase of
emissions reductions from other countries.
This does not appear to be based on a
legitimate concern to ensure that any purchases overseas are from sound schemes
that deliver genuine emissions reductions or a desire to demonstrate that Australia

reduction target; Daley and Edis (2011, p 3). A similar estimate is reached by Denniss and Grudnoff
(2011, p 4).
Dr Alan Moran, Institute of Public Affairs, Joint Select Committee on Clean Energy Future Hansard,
27 September 2011, p 62.
See for example McKinsey & Co, (2008, p 6). The cost curve is shown on p 14.
Similarly, Treasury (2011) has said there are a number of reasons why sustained price
discrimination is unlikely to be practical: the government is often at a substantial information
disadvantage compared to the firm bidding for the abatement activity and firms also tend to act
strategically which leads to convergence of bids at a higher final price.
Irrespective of whether you paid $50,000 or $500,000 for your house, if other people are selling
similar homes for $700,000, thats what youll ask for; Edis (2013a).
McKinsey (2008, p 18) point this out. The Business Council called for "no restriction on the number
and type of international permits that can be used to meet Australia's obligations; Lenore Taylor,
'Abbott plan would double carbon cost', Sydney Morning Herald, 15 September 2011.
As Coalition (2010, pp 2 and 14) puts it, we don't believe Australians should have to pay a great
big new tax to fund outcomes in other countries. Tony Abbott said at a press conference on 15
August 2013 that if you simply buy international offsets, there is a sense in which you are shirking
your environmental duty.
can achieve significant emissions reductions. It appears to be an odd view that only
emissions reductions in Australia will reduce the impact of climate change in
Australia. Ruling out any contribution from international action means that the
reductions in the prices of permits in the EU scheme do not cut the cost of the
Coalitions approach.
Assessing the bids
In the Coalitions original version, the bidding process would have been extremely
complex as the bids were not just to have been assessed on the claimed emissions
reductions relative to a baseline, but have to take into account a variety of other,
including qualitative, aspects. Under the version of the scheme taken to the 2010
and 2013 elections, Coalition (2010, pp 13-15), to ensure the Fund supports a broad
range of direct action initiatives, measures considered by the Fund will be assessed
against similar proposals from similar sectors. Assessment of projects will also take
into account any additional significant public policy benefits and a tender would only
be accepted if the tenderer could prove that the project would deliver additional
practical environmental benefits, not result in price increases to consumers and
protect Australian jobs. This massive bureaucratic undertaking has been quietly
This would seem to mean that earlier assurances that the scheme would not lead to
higher prices for consumers no longer hold. For example, Mr Hunt had said of power
stations that "our approach would be - potentially - to provide them with incentives
[but] unless costs [to consumers] remain the same, we would find other means of
reducing emissions".
Mr Abbott had said "we won't be purchasing outcomes that do
increase the price to consumers".

While successful bidders who do not meet their promised emissions reductions will
not receive their payments, the Coalition has said little about the extent of any fines
for non-performance. The White Paper says contracts will include provisions to
make-good, unless under-delivery is not reasonably within the control of the
If these provisions are to be stringent, they will discourage firms with
any doubts about their projects from tendering and so raise the cost of the scheme. If
they are weak, many perhaps most of the successful tenders will be from firms
with speculative bids based on wishful thinking about the subsequent emissions
reductions, and so the emissions reductions achieved will be even smaller. By the
time it is realised that emissions reductions are not occurring, it will be too late to
accept other bids.
Assessing the tenders to ensure that they do involve genuine reductions in
emissions will not be an easy task. As Malcolm Turnbull has said, "if a scheme

Greg Hunt MP, interview with Chris Uhlmann, 7.30, 24 May 2011, ABC website.
Tony Abbott MP, interview with Chris Uhlmann, 7.30, 4 July 2011, ABC website.
Australian Government (2014, p 9).
operates whereby the government pays the firm to reduce its emissions
intensitythere is firstly going to be a substantial and contentious debate about what
the correct baseline is, and then whether it will actually be reducedArguments of
considerable ferocity will arise as to whether a new piece of equipment would have
been bought anyway, with the risk that the government ends up funnelling billions of
dollars to companies to subsidise their profit without achieving any real additional
cuts in emissions."
The more firms are paid for emissions reductions they are
currently undertaking anyway, the less likely is the 5 per cent reduction target to be
A study by Daley and Edis (2011, p 21) of the experience of governments in
assessing tenders for emissions reductions is instructive: "the tender process itself
usually takes several years to select the projects and finalise funding agreements.
Government tends to struggle to identify the best projects. The assessments
required are inherently difficult because the projects often involve cutting edge
technology or are highly complex. The process favours overoptimistic bids, which
then makes completion unlikely. Furthermore over the long periods involved in rolling
out grant tendering programs, unforeseen changes unfold that result in winning
bidders projects becoming uncommercial. At best these programs are a wasteful
distraction, since most of the money is never spent".

Other apparently abandoned aspects of the scheme
Another aspect of the scheme presented to the electorate that has apparently been
abandoned is the vague and uncosted reference in Coalition (2010, p 17) to "work
with the electricity sector on the design of potential assistance that could be provided
through the Fund to ensure both fairness and cost parity for consumers".
Similarly, there is no reference in the White Paper to any compensation for
companies such as Hydro Tasmania that would lose from abolition of the carbon
price. Treasurer Hockey had said that compensation would be considered on a case

Malcolm Turnbull MHR, House of Representatives Hansard, 8 February 2010, p 581.
A similar conclusion was reached by the Australian National Audit Office (2010, p 21). Its evaluation
of GGAP, a competitive grants programme similar to the direct action programme, "noted
shortcomings in the assessment of projects for the first two rounds of the GGAP. The third round also
had significant shortcomings in the assessment processNone of the shortlisted project proposals
recommended by the department could provide the large scale abatement at low cost, and with a high
degree of certainty required by the programs guidelines. The three highest ranked (and
recommended) projects were technically ineligible as they did not meet the Australian Governments
primary criteria for the program. For these three projects, which were subsequently approved by the
then Minister, only one project has produced any abatement to date. However, this was less than one
third of the threshold specified for the program. The Howard Government's Green Gas Abatement
Program, also similar to the 'direct action' scheme, achieved less than half of the abatement planned
due to low take-up by business, according to the Department of Climate Change (2010a, pp 7-8). The
experience of firms tendering is also informative: "Many bidders interviewed by the Grattan Institute
indicated that the lack of clarity around how criteria might be interpreted made it very difficult to
develop bids and make informed judgements about future investment decisions"; Daley and Edis
(2011, p 26).
by case basis and claimed we have allocated funds under our Direct Action plan to
deal with initiatives that are underway.

Administrative costs
Professor Ross Garnaut (2014) has criticised the huge and intrusive bureaucratic
exercise that direct action involves.
The head of the Department of Climate
Change said the Coalition's approach would "clearly be more resources intensive" to
His department (2010a) described it as having high administrative
overheads for government and business and commented specifically that "soil
carbon purchasing would inherently involve higher administrative overheads than
other abatement due to the multiplicity of small scale grants". And because it is an
auction, nothing can happen until every tender has been assessed.
Once the successful tenders are selected, for the expenditure to be effective it will be
necessary to check that the promised emissions reductions are actually being
implemented by the successful bidders, and verify that they would not have occurred
without the support. This will require a lot of inspectors empowered to investigate
companies' operations in a quite intrusive way.
The White Paper has not done a lot to clarify the brief confusing references in the
original paper to a penalty system for firms which increase emissions. The White
Paper states that no revenue from firms is sought
from penalties, an interesting
comment given the criticism the Opposition has made of taxes that raise no
revenue in the context of the mining tax debate.
The penalties, which are now referred to as a safeguard mechanism, will operate
from July 2015. They will only apply to facilities emitting over 100,000 tonnes a year,
thereby exempting firms that account for around half Australias emissions.
methodology for calculating baselines for the safeguard mechanism is still being
developed and may well differ from the approach to calculating benchmarks for
assessing tenders.
The baselines will be set using the highest level of reported

Sydney Morning Herald, 25 February 2013.
The Australia Institute calculates that "If we make the generous assumption that the average
abatement per project under the Coalitions scheme is 25,000 tonnes of emissions then there would
need to be about 28,500 successful projects. If we assume four unsuccessful projects for every
successful one then the number of projects assessed would be close to 150,000; Denniss and
Grudnoff, (2011, p 5). This may be conservative as the NSW Government's Greenhouse Gas
Abatement Programme had about nine unsuccessful applications for every successful one.
Mr Blair Comley, Secretary, Department of Climate Change and Energy Efficiency, Senate
Environment and Communications Legislation Committee, Supplementary Estimates Hansard, 17
October 2011, p 12.
Australian Government (2014, p 12).
Australian Government (2014, p 52).
Dr Steven Kennedy, Deputy Secretary, Department of the Environment, in Senate Environment and
Communications Legislation Committee (2014b, pp 79-80).
emissions for a facility over the historical period 200910 to 201314 but there is a
vague reference to flexibility could be provided where a business emissions rise
above absolute baselines, but that business can demonstrate that its emissions-
intensity of production is not rising.

More ambitious targets
Another criticism of the direct action scheme is that "many of the direct action
measures cannot be scaled up to achieve significant levels of abatement. For those
that can be scaled up, the cost per tonne of abatement would rise rapidly, imposing
further costs on taxpayers and consumers."

This is important as the 5 per cent target is manifestly inadequate. Especially as
Australia is one of the worlds highest per capita emitters, one of the worlds
wealthiest economies and one of the countries likely to be most adversely affected
by global warming, a 5 per cent reduction does not represent a fair share of the
global effort required to restrain global warming to less than 2 degrees.

The Climate Change Authority (2014, pp 9-10) has recommended a minimum 2020
target of 15 per cent below 2000 levels as a 5 per cent target for 2020 would not be
a credible start by Australia towards achieving the below 2 degree goal. It would
leave an improbably large task for future Australians to make a fair contribution to
global efforts.
Views on the direct action plan
Around 25 Nobel prize winners in economics have expressed support for a carbon
tax or emissions trading scheme but none have come out in favour of a tender
system such as direct action.
Fairfax Media surveyed 35 Australian academic and
business economists; 30 replied that a carbon price was superior to direct action,
three rejected both, one favoured direct action because it was really no action and
the other was a climate sceptic.

Australian Govrnment (2014, pp 53-55).
Department of the Treasury, incoming government brief,
1442/ pp 10 and 11.
Treasury secretary Dr Martin Parkinson commented "we did not believe the direct action programme
could be scaled", Senate Select Committee on Scrutiny of New Taxes Hansard, 24 March 2011, p 26.
For a summary of arguments by the organisations that support this view, see Senate Environment
and Communications References Committee (2014a, pp 14-22).
Hawkins (2014, pp 23-24). Mr Hunt (2013) misleadingly suggested that three Nobel Prize winners
(Thomas Schelling, Vernon Smith and Finn Kydland) prefer direct action to a carbon price. They
actually preferred research into geo-engineering and other technology as a means of addressing
climate change to policies that reduce emissions. They were rejecting direct action as much as a
carbon price. Indeed they were not asked to look at a direct action model as it is well known that a
uniform carbon tax is the cheapest way to abate emissions; Tol (2010, p 74).
Tony Abbotts new direct action sceptics, Sydney Morning Herald, 28 October 2013. Dr Chris
Caton from BT Financial said that any economist who preferred direct action should hand his degree
A wide range of corporate representatives have indicated that the direct action
scheme is inferior to pricing carbon or have criticised the lack of information about
the proposal.
Even groups usually close to the Coalition are unsupportive. The
Business Council believe the most effective system to reduce emissions is one
primarily based on a market solution, such as an emissions trading system.
Institute of Public Affairs has called direct action undesirable and conceded that
emissions trading schemes are arguably more efficient.

Concluding remarks global implications
Especially at a time when the science of climate change is becoming firmer, and
Australian meteorologists are adding new colours to temperature maps to reflect
unprecedented warming
, for Australia to replace a credible emissions trading
scheme with a sketchy so-called direct action plan will have adverse impacts
beyond our shores. It will be misrepresented as indicating that carbon pricing had a
serious adverse impact on the Australian economy and so set back the cause of
climate action in other countries. Among better informed international audiences it
will be seen as an act of selfishness by a rich country unwilling to contribute its share
to international action.

John Hawkins is a PhD student at the Australian National University. He has a
Masters degree from the London School of Economics and has worked in senior
positions at the Reserve Bank, Bank for International Settlements and the Australian
Treasury. He served as secretary to the Senate Economics Committee and the
Senate Select Committee on Climate Policy.
Australian Government 2013, Emissions Reduction Fund Green Paper. December.
Australian Government 2014, Emissions Reduction Fund White Paper. April.
Climate Change Authority 2014, Targets and Progress Review Final Report.

back. This accords with a poll conducted at the Australian Conference of Economists which asked
whether "the Coalitions Direct Action approach to greenhouse gas emissions is good economic
policy". Of the 145 respondents, only 11 per cent agreed and 62 per cent disagreed (of which 43 per
cent disagreed strongly).
For examples, see Hawkins (2014, pp 18-19).
68 (accessed 6 March 2013).
Tim Wilson, Director of Climate Change Policy, Institute of Public Affairs, (2013).
The Economist, 12 January 2013, pp 24-26. 2013 was Australias hottest year on record.
In Europe it may be seen as Australia reneging on the agreement to link the EU and Australian
Climate Institute, 2013, Coalition climate policy and the national climate interest,
Coalition, 2010. The Coalitions Direct Action Plan.
%20Coalitions%20Direct%20Action%20Plan%20Policy%20Web.ashx (downloaded
24 July 2011.)
Daley, J and Edis, T 2011, Learning the Hard Way: Australia's Policies to Reduce
Emissions, April, Grattan Institute, Melbourne.
Denniss, R and Grudnoff, M, 2011. The real cost of direct action, Australia Institute
Policy Brief, no 29, July.
Department of Climate Change, 2010a. Analysis of Coalition Climate Change Policy
Department of Climate Change, 2010b. 'Summary of the abatement potential, cost
and emissions in 2020 of the Opposition climate change policy', 3 February.
Department of the Treasury, 2011. Economic and fiscal impacts of the Coalitions
direct action plan, Treasury minute released under Freedom of Information, 14 July.
Edis, T 2012, Why no one trusts the Coalition on climate change, Climate
Spectator, 16 November.
Edis, T 2013a, Abbotts $4 billion climate budget blow-out, Climate Spectator, 15
Edis, T 2013b, Hunts back of envelope foundations for direct action, Climate
Spectator, 3 May.
Edis, T 2013c, Hunt puts some flesh on bones of Direct Action, Climate Spectator,
28 February.
Garnaut, R 2014, Indirect action, The Saturday Paper, 15 March, p 7.
Hawkins, J. 2014, The Direct Action Approach to Climate Change. Submission 7 to
the Senate Environment and Communication References Committees inquiry into
the Abbott Governments Direct Action Plan, 5 January.
Hunt, G 2012a, Address to the 5
annual Carbon Farming Conference, 24 October.
Hunt, G 2012b, Speech to Carbon Expo Australia Clean Energy without a carbon
tax, 10 November.
Hunt, G 2013, Speech to the Sydney Institute, 30 May.
Kragt, M et al, 2012, Assessing costs of soil carbon sequestration by crop-livestock
farmers in Western Australia, Agricultural Systems, October.
Markwell, D, Thompson, R and Leeser, J (eds) 2013, State of the Nation: Aspects of
Australian Public Policy, Menzies Research Centre.
McKinsey & Co, 2008. An Australian cost curve for greenhouse gas reduction.
Milne, C 2013, Will 2013 be the tipping point for energy efficiency and decentralised
energy?, speech to Second Australian Summer Study On Energy Efficiency and
Decentralised Energy, 1 March.
Oakeshott, R. 2014. The Independent Member for Lyne. Allen & Unwin. Sydney.
Reputex Carbon 2013, Emissions Trading Versus Direct Action, August.
Sanderman, J, Farquharson, R and Baldock, J 2010, Soil Carbon Sequestration
Potential: a review for Australian agriculture, CSIRO.
Senate Environment and Communications Committee 2014a, Direct Action: Paying
Polluters to Halt Global Warming?. March.
Senate Environment and Communications Committee 2014b, Proof Committee
Hansard of Estimates hearing, 26 May.
Sinclair Knight Merz, 2013. A review of subsidy and carbon price approaches to
emission reduction, 14 August.
Steffen, W and Hughes, L 2013, The Critical Decade, Climate Commission, June.
Tol, R 2010, Carbon dioxide mitigation, in B Lomborg (ed) Smart Solutions to
Climate Change.
Wilson, T 2013, Property rights and the ETS, Climate Spectator, 19 July.


The practice of decision making in coastal climate change
adaptation: Reflections from a Victorian case study

Steve Blackley

Western Coastal Action Planning, Department of Environment and Primary
Industries, PO Box 103 Geelong, Victoria, 3220

* Email:


This paper outlines some of my reflections on decision-making in climate adaptation
as a result of completing a project through the Australian Governments Climate
Adaptation Pathways Projects program. Ill explain one key concept that applies
across the five reflections, provide a brief outline of the project itself and then reflect
on two conceptual issues and three coastal management issues from the project
which I consider have significant implications for effective adaptation decision


I wish to highlight a key concept which influenced this project. It appears to have a
profound effect on peoples ability to grasp and appreciate the potential of new
information and ways of doing things. Through this project, possibly the greatest
issue to overcome was the individual and collective comfort zone of participants and
stakeholders and their resultant attitudes to non-market economic value.

In light of recent events, I provide an authoritative definition of what a comfort zone

The comfort zone is a behavioural state within which a person operates in an
anxiety-neutral condition, using a limited set of behaviours to deliver a steady
level of performance, usually without a sense of risk (White 2009).

While this definition can be argued in many directions, through our project it seemed
that peoples comfort zones were strongly influenced by their apparent knowledge,
the systems they worked within and what they perceived others comfort zones to be.
I see these as very important for adaptation, as our comfort zones would seem to
either constrain or enable the way we interpret and apply information, and thus the
operation of decision making systems.

If good decisions are to be made for effective adaptation, it would appear that we
need a far more effective approach to extending and developing the comfort zones
of those involved in the various stages and with various levels of influence in the
decision making process. If good decision-making is our aim, then we may well need

I undertook this work for the Western Coastal Board in 2011-13 when I was Executive Officer to the
Board. These reflections are my own and I am not representing the views of Government.

to seek to understand psychology in the same way we seek to understand the
economic implications of climate change.

The case study in question

In 2011-12, the Western Coastal Board and partners conducted a world-first non-
market economic valuation of caravan parks and beaches, and developed a decision
support framework to guide decision makers through the generation, interpretation
and application of that sort of information in existing decision making processes
which currently consider climate adaptation. Five locations were chosen to conduct
the research, including Port Fairy, Warrnambool, Apollo Bay, Barwon Heads and
Portarlington. Importantly, information was generated through survey questionnaires
with both campers and residents of the town in which the caravan park was located.

While the Value and Equity Framework for Climate Adaptation: Coastal Caravan and
Camping Parks Case Study Project looked at coastal caravan parks because of the
obvious implications of climate change to these locations and their infrastructure, a
number of other issues added to the potential to apply caravan park findings more
broadly. In addition to being flooded or washed into the sea, effective adaptation for
caravan parks presents many challenges for land managers in providing equitable
access to the coast, they generate significant revenues to support coastal
management and thus adaptation, and the different levels of exclusivity from
different levels of tenure available to campers have some parallels to private
property tenures which present their own vexed issues for adaptation.

In addition to new non-market economic values, the project generated new and
highly relevant social information on camper attributes, and on the equity
preferences and adaptation preferences of both campers and town residents, all of
which informed the decision support framework. The framework focussed on how to
bring such new information into the adaptation options assessment process and then
apply it to three existing decision making processes to try and stay within
practitioners comfort zones. These three processes include business planning,
consent for use and development through the Coastal Management Act 1995, and
the land-use planning system. All three have a current role in climate adaptation and
are anticipated to have a far stronger role in future.

Importantly, we sought to involve a range of people in the project, including the
survey respondents at five towns on Victorias west coast and a range of
practitioners. We generated the information using survey instruments with both
campers in the parks and residents from the town adjacent to the park so that we
had two distinct perspectives and sets of information. We also used practitioner
groups and workshops to test the presentation of information and refine the decision
support framework so that it would be targeted at practitioner understanding and

While the new non-market economic information was the primary factor challenging
practitioners comfort zones, people were also significantly challenged by the
importance of using such information and the techniques used to generate it. The
question of how to bring the economic and social information in to decision-making
processes was made even harder because, despite clear expectations that a

balanced approach be taken to consider social , environmental and economic issues
in decision making, the status quo appears to deem that this information is generally
too difficult or unreliable. As a result, current approaches rarely, if ever, seek to
acknowledge the importance or the need to include it.

Appreciating economic value

The project did attempt to confirm market economic values for caravan parks, but the
main conceptual issue we needed to communicate was that of non-market economic
value. It was clear through the initial stages of the project that most peoples thinking
was dominated by market value. After all, this is what people see in their everyday
lives, as well as in most coastal decision-making processes. However, the degree of
scepticism around, and in some cases hostility towards, non-market value surprised
me. We saw a lot of people eager to understand it, but we also had people with
precious little or no knowledge of how to generate the information or apply it
expressing strong doubts about both the veracity of the information generated and
the importance of balancing decision making with it.

Another interesting observation was the apparent bias of many coastal managers
towards ecosystem services and away from anthropocentric benefits and values that
exist often independent of the environment. Perhaps this reflects the comfort zones
of many coastal managers who are trained in environmental sciences, but it does
suggest that the expertise and experience brought to bear on coastal adaptation
needs to extend well beyond physical and biological sciences if it is going to be

Appreciating equity

The concept of equity presented possibly the most difficult challenge to the project,
and elicited a wide range of reactions from people. In general, people understand
that equity is about fairness, and participants appreciated the need for equity in
climate adaptation decisions. Both campers and residents responded well to the
equity components in the survey, with many anecdotally noting that this was the first
time that they had been asked these kinds of questions.

However, some people appeared to feel very threatened by the inclusion of equity in
the project. We experienced surprising opposition to it at the start of the project due
to perceptions of political sensitivity, and this presented the very real possibility that
the project would not go ahead. Thankfully, the ignorance driving this response was
tempered and the project proceeded, but it highlighted the need to be very careful
when dealing with new concepts and providing clear explanations, especially where
people perceive threats to their comfort zones.

On a more positive note, the equity component of the project yielded some very
interesting results about what people think is fair in the context of coastal adaptation.
The distinct advantage of generating this information is that we now know what
people think is fair, as opposed to what decision makers might be led to believe
people think. Of course, this will challenge those with power in decision-making, but
it is precisely the sort of information we need to invest in.


People make decisions

It may sound strange, but it seems that we often forget that it is people who make
decisions using processes we cannot rely on the integrity of processes alone for a
good outcome. The concepts, processes and information we use to make decisions
are all essentially driven by human constructs and values. Yet it seems to be only
relatively recently that those seeking outcomes around sustainability, particularly
those with their comfort zone centred on protection of the environment, have started
to understand that without proposed change making sense to people within a
paradigm dominated by those same constructs and values, the chance of success in
delivering environmental protection measures are greatly diminished. If were going
to get people to make better decisions, we have to get them out of their comfort
zones and show them why a new approach is both important and relevant to them.

It quickly became clear to us that to get people on board with new concepts and
information, we needed to make the value of the information clear, and the
application of the decision support framework highly relevant to both their day-to-day
and strategic needs. It helped that the information generated through our project was
more focussed on people and their use of the environment and amenities, rather
than about an externality such as the environment per se. Working through the
information and the decision process with practitioners greatly assisted people to
become more comfortable with the project. We watched pennies drop, and received
constructive feedback for both refining the products and for communicating them
effectively. Had time allowed, we would have liked to pilot the use of the information
and decision support framework in addressing issues at one of the five caravan
parks surveyed.

Risk management

It seems that coastal climate change adaptation and risk management are becoming
synonymous, which I would argue does not do justice to adaptation. A risk
management approach is certainly worth progressing for coastal climate issues, but
one has to wonder where the boundary between risk management and change
management might be. In the main, risk management appears better suited to issues
that remain relatively static, and is better at assessing risks to the status quo. But if
climate risks are going to evolve over time, perhaps it is better to approach things

As mentioned, risk management is worth progressing. However, this project
highlights a critical question for effective adaptation via risk management
approaches is our coastal risk assessment process sufficiently informed and thus
sufficiently accurate to deliver good decision-making?

I would argue strongly that risk management has significant potential to assist good
coastal adaptation decision-making, but that the current state of information able to
be applied to the assessment process is seriously inadequate. While we may be able
to identify the likelihood of an event or scenario with a reasonable level of
confidence, we do not have a sufficient understanding of value to inform
determinations of consequence of risks. How can you quantify the consequences of
an event without a proper understanding of the value of environmental, social or

economic attributes of the assets at risk from the event? If we rely on the very limited
datasets and valuation information we currently have, we run the very real risk that,
in our ignorance, we will protect the things we value least.

Good risk assessment would then ensure that the measures of consequence in risk
management reflect their holistic value. Our project sought to generate non-market
economic and preference information which could be included in risk assessments,
and show how this can be done through the decision support framework.
Importantly, it sought to illustrate that this kind of information is integral to good
decisions and can be undertaken without the degree of difficulty often attributed to it.

The next question I have is whether we think the opportunities presented by risk
assessment and management are being harnessed properly and applied to other
coastal issues? There are a wide range of risks inherent in many coastal
management and adaptation challenges, and yet I have not seen the process
applied to many other pressures that pose threats to our enjoyment of the status
quo, such as population or tourism growth, let alone to future scenarios exacerbated
by climate change.

Integrated coastal zone management

The concept of integrated coastal zone management (ICZM) was developed over
recent decades to promote a coordinated and integrated response to the many
pressures affecting the coast. However, our performance in this area is fair at best.
Part of our rationale for the project was the potential broader application of the
information and processes we generated through the project to the myriad other
issues for coastal management and adaptation beyond caravan parks. Caravan
parks, as noted earlier exhibit a range of characteristics with parallels to many other
coastal and adaptation issues.


If we are considering injecting our decision making with new information or
approaches, we must ask whether our decision-making systems are sufficiently
evolved to accommodate such things. If that potential exists, which I believe it does,
is there then the opportunity to leverage the incredible effort being dedicated to
climate change adaptation to help achieve a far more effective coastal planning and
management system? Climate change, after all, is simply another pressure albeit a
highly complex one.

The reports generated by the project include a literature review, a research report
and a decision support framework. They are all available at and
I encourage interested people to read them.


White, A., 2009. From Comfort Zone to Performance Management. White &
MacLean Publishing.

Economic sustainability: what should it be?
Haydn Washington

Visiting Fellow, Institute of Environmental Studies, University of New South Wales,
* Email: Ph: (02) 9385 5730. Fax: 02) 9663 1015.
Postal Address: Level 4 Electrical Engineering Building, Kensington, NSW, Australia,
Many speak of economic sustainability but few define what they mean. On a finite
world with biophysical limits, what should it mean? Firstly, it must be based on
ecological reality and limits. It must acknowledge human dependence on nature and
the environmental crisis caused by ignoring this. It must move past denial of our
problems, as you dont solve problems you deny exist. The paper analyses the
underlying assumptions of neoclassical economics, and their failing to be based on
ecological reality. It then considers what economic sustainability should be and
considers immediate first steps, and the path to first a green economy and then a
steady state economy.
steady state economy, growthism, neoclassical economics, growthmania, green
economy, economic sustainability
What should economic sustainability mean? Oikonomia = management of a
household or economics. At its simplest, the economy is how we organise things in
our society, how we produce food and materials, trade them, and swap skills. It is the
study of how humans make their living, how they satisfy their needs and desires
(Common and Stagl, 2005). The economy was thus meant to serve society. Good
economics should be good management of the home we study with ecology. This is
how ecological economics sees things. However, this is not the case for mainstream
economics. Modern neoclassical economics is fraught with issues of worldview,
ideology, assumptions, ignorance of ecological reality, and denial. The growth
economy is also arguably the largest elephant in the room (Zerubavel, 2006) that
most of us still refuse to see. Perhaps the greatest denial regarding the major
problems underlying the environmental crisis is that around the growth economy,
eclipsing even climate change denial (Washington and Cook, 2011). There are also
deep ethical questions that need to be discussed.

Humanity faces an environmental crisis (MEA, 2005), and have exceeded at least
three planetary boundaries (Rockstrom et al, 2009). A major (but often
unacknowledged) driver behind this is the growth economy promoted by neoclassical
economics (Daly 1991). It has become the given truth of our times, what Ellul
(1975) has called the chief sacred in society. This is true even in many academic,
media and environmental circles. This paper deals the problems of the dominant
neoclassical economic synthesis and considers solutions such as the steady state
economy. There are of course other schools of economic thought (Foxon et al, 2012)
not discussed due to space limits. There has also been extensive discussion of the
service economy in academia, but here I will observe only that a service economy
cannot be completely decoupled from energy and material use, and hence the
impacts of growth (Daly, 2012).
Since the 1980s the general embrace of neoclassical economics has led to
increasing inequalities of wealth and more frequent and severe booms and crashes.
Sukhdev (2010) sees the root cause of biodiversity loss as being our dominant
economic model, which:
... promotes and rewards more versus better consumption, private versus
public wealth creation, human-made capital versus natural capital. This is the
triple whammy of self-reinforcing biases that leads us to uphold and promote
an economic model in which we tend to extract without fear of limits, consume
without awareness of consequences and produce without responsibility for
third party costs, the so-called externalities of business.
The underlying assumptions of neoclassical economics
Neoclassical economics doesnt concern itself with long-term economic
sustainability, while ecological economists do, as should society. There are
assumptions that neoclassical economics makes about how the world works that
should be examined if we are to reach economic sustainability (Washington, 2015 in
publication). These include:
1) Strongly anthropocentrism. Nature is seen as just a resource to be used to
provide the greatest utility to the greatest number of people. Land becomes
merely resources and natural capital. Such an approach does not consider
the limits or tipping points of ecosystems.
2) The idea that the free market will control all that is needed, that the invisible
hand will regulate things for human benefit (Daly, 1991). This is a given truth
that has become almost a religion (Daly, 2008). Stiglitz (2002) noted the
invisible hand was invisible because it is not there. Market failures of various
kinds mean that actual market outcomes are not efficient. Achieving efficiency
does not guarantee equity, between either those alive at one point in time, or
different points in time (Stiglitz, 2012).

3) The idea that the economy can grow forever in terms of continually rising
GDP, which increased 25-fold over the last century (Dietz and ONeill, 2013).
Daly (1991) notes that economic growth is the most universally accepted goal
in the world and that: Capitalists, communists, fascists and socialists all want
economic growth and strive to maximise it.
4) The refusal to accept any biophysical limits to growth, for when classical
economics was developed, limits were distant (Daly, 1991). One caveat
needs to be added here, in that Thomas Malthus was one classical economist
who did understand that population growth would run up against limits
regarding what the world could supply. However, neoclassical economics
today mostly continues to fail to acknowledge any limits on a finite Earth. Daly
(1991) notes that three inter-related conditions: finitude, entropy, and complex
ecological interdependence - combine to provide the biophysical limits to
5) A circular theory of production causing consumption that causes production in
a never-ending cycle. Daly (1991) notes that real production and consumption
are in no way circular. The growth economy sees outputs returned as fresh
inputs and Daly notes ironically this requires we discover the secret of
perpetual motion. An economy is not an isolated system, it is part of (and
relies on) the biosphere. Money fetishism is the idea that money flows in an
isolated circle, and thus so can commodities. This is a classic fallacy of
misplaced concreteness (Daly, 1991).

Figure 1 The assumed circular flow of production and consumption in the
neoclassical economy, after Daly (1991).

6) Neoclassical economics ignores the Second Law of Thermodynamics and
fails to consider entropy as a key feature of economics and reality.
Georgescu- Roegen (1971) and Daly (1991) detail this. Thermodynamics
shows that we do not create or destroy anything in a physical sense, we
merely transform or rearrange it. The inevitable cost of arranging greater
order in one part of the system (the human economy) is to create disorder
elsewhere - nature (Daly, 1991). Entropy is a measure of the disorder in a
closed system. In thermodynamics, low entropy quantities (usable energy,
raw materials) move to high entropy quantities (waste heat and wastes).
Entropy is the basic physical coordinate of scarcity. Were it not for entropy,
we could burn the same gallon of petrol over and over, and our capital stock
would never wear out.
7) Environmental damage is merely an externality. The spillover effects of
market transactions have been named externalities. Externalities are costs or
benefits arising from an economic activity that affect somebody other than the
people engaged in it, and are not reflected fully in prices. Environmental
damage is known as a negative externality, considered something external to
the economic model. An externality is thus seen as being worth only
peripheral attention (Daly and Cobb, 1994). This is a key part of what has led
to the environmental crisis. Of course, environmental crises can still occur
even where externalities are 'internalised' (incorporated into market
accounting). Foxon et al (2012) point out this approach is inadequate for
climate change and biodiversity loss. However, attempting to internalise such
costs is a better approach than ignoring them.
8) All forms of capital can be substituted, thus human capital can be substituted
for natural capital (weak sustainability) (Solow, 1974)
The above assumptions have been detailed individually by others, principally
Herman Daly (Daly, 1991; Daly and Cobb 1994), though rarely collated together as
shown here. They show the fundamental challenge we face to reach any meaningful
economic sustainability. Looking at them from the viewpoint of environmental
science, the above assumptions are quite bizarre and untenable. However, they
underpin the reigning neoclassical economic synthesis to this day.
The Steady State Economy instead of growthmania
The steady state economy was developed as a non-growth alternative to endless
growth. Nicholas Georgescu-Roegen wrote The Entropy Law and the Economic
Process in1971. He was followed by his student, Herman Daly, who coined the term
the steady state economy in 1973.
The key points of the steady state economy (Daly, 1991) are:

1) Constant population (at an ecologically sustainable level)
2) Constant low level of throughput in materials and energy.
Throughput is the entropic physical flow of matter-energy from natures source
through the human economy and back to natures sinks. Neither population nor
artefacts can continue to grow forever. What is held constant is capital stock in the
broad sense: capital goods, consumer goods and human population. What is not
held constant is growth in our culture, knowledge, and ethics. If the world is a finite,
complex system that evolved using a fixed rate of flow of solar energy, then any
economy that seeks indefinite expansion of its stocks and energy use will sooner or
later hit limits. This is logically trivial, a truism, but it is not trivial psychologically or
politically (Daly, 1991). Czech (2000, 2013), Victor (2008), Jackson (2009), Heinberg
(2011) and Dietz and ONeill (2013) and have continued to develop this theme. The
steady state economy is deduced from first principles regarding physical laws and
ecological limits.
The vision of neoclassical economics is that the economy is an isolated system in
which exchange value circulates between firms and households. In neoclassical
economics it doesnt matter how big the economy is relative to the environment or if
it impacts disastrously. This contrasts to reality, where a linear flow of energy and
materials moves from low entropy (usable energy, rich resources) to high entropy
(heat and waste) (Daly, 1991). For the steady state economy however, the vision is
that the economy is an open subsystem of a finite and non-growing ecosystem. The
economy lives by importing low-entropy matter-energy (raw materials) and exporting
high entropy matter-energy (waste).
The Limits to Growth (Meadows et al, 1972) was fiercely attacked in 1972 because
it challenged the fundamental myth of modern society: unlimited growth. Hubbert
(1993) argues that during the last two centuries we have known nothing but
exponential growth and have evolved an exponential growth culture, dependent on
the continuance of exponential growth for its stability. This culture is incapable of
reckoning with problems of non-growth (Daly and Cobb, 1994). Daly (1991) argues
that economic growth is unrealistically held to be:
the cure for poverty, unemployment, debt repayment, inflation, balance of
payment deficits, the population explosion, crime, divorce and drug addiction.
Thus economic growth is seen as the panacea for everything. Daly (1991) notes that
the verb to grow has become twisted. We have forgotten its original meaning: to
spring up and develop to maturity. The original notion included maturity, beyond
which accumulation gives way to maintenance. Growthmania is not counting the
costs of growth. Society today takes the real costs of increasing GNP (as measured
by expenditures incurred to protect ourselves from the unwanted side effects of

production) and adds these expenditures to GDP, rather than subtract them. We
thus count real costs as benefits, and this is hypergrowthmania (Daly, 1991).
One fascinating historical note is that none of the key classical and neoclassical
economists (such as Smith, Mill and Keynes) thought an economy could grow
forever (Dietz and ONeill, 2013). They all spoke of a growth period, after which the
economy levels off. Mill (1859) thought a stationary state of capital was a
considerable improvement on our present condition. Once we have gone beyond
the optimum, and marginal costs exceed marginal benefits, growth will make us
worse off. We have then reached uneconomic growth (Daly, 2008). However, our
experience of diminished well-being will be blamed on product scarcity. The
neoclassical response will then be to advocate increased growth to fix this. In the
real world of ecological limits, this will make us even less well off, and will lead to
advocacy of even more growth. As Daly (1991) notes: The faster we run, the
behinder we get. Daly argues that environment degradation today is largely a
disease induced by economic physicians who treat the sickness of unlimited wants
by prescribing unlimited production.
It should be made clear that the steady state economy is not the same as the green
economy promoted by UNEP (2011) and the Rio+20 Summit in 2012. Interestingly,
was brought out by UNEP without any reference to the steady state economy that
had been discussed since the early 1970s . UNEP (2011) defines the green
economy as low carbon, resource efficient and socially inclusive. However, it
remains a growth economy, stating the greening of economies is not generally a
drag on growth but rather a new engine of growth. The need to stabilise population
is also not addressed. Regarding resource use, a central challenge was seen to
decouple growth absolutely from material and energy intensity. However, almost all
economic production requires the transformation of raw materials (Costanza et al,
2013), so it is highly unlikely that economic growth could be absolutely decoupled.
Indeed Victor (2008) details that there has been modest decoupling which has been
overwhelmed by continuing growth. UNEPs green economy does some necessary
things (low carbon and material use) but is not sufficient to achieve sustainable
human well-being (Costanza et al, 2013).
The ethics of economics
Given that economic sustainability is part of sustainability overall, there is also the
question of worldview and ethics as to how we might reach economic sustainability.
Is there an ethics of economics? Rolston (2012) notes that if neoclassical economics
is the driver we will seek for our society, then it will result in maximum harvests in a
bioindustrial world, as the current economic model is extractive in nature, and
commodifies the land. Unless the underlying growth paradigm and its supporting
values are altered, all the technical prowess and manipulative cleverness in the
world will not solve our problems, and in fact will make them worse (Daly, 1991).
Daly (2008) concludes that in the end, neoclassical economics is religion. Daly

(1991) suggests that society could accept the eventual destruction of life-support
capacity as the price we must pay for freedom from restriction of individual rights to
grow. However, he observes:
It is widely believed by persons of diverse religions that there is something
fundamentally wrong in treating the Earth as if it were a business in
Originally, economics started as a branch of moral philosophy (e.g. Smith, 1759),
and ethics was at least as important as analytic content. However, economic theory
become more and more top heavy with layer upon layer of abstruse mathematical
modelling, erected above the shallow concrete foundation of fact (Daly, 1991).
Economics reduced ethics to the level of personal tastes. Individuals set their own
priorities, and economics became simply the mechanics of utility and self-interest. It
thus divorced itself from ethics. The big problems of overpopulation and
overconsumption have no technical fixes but only difficult moral solutions (Daly,
1991). The steady state economy is seen to threaten Big Science and high
technology, for it argues all things are not in fact possible through technology. For
these reasons the steady state economy is resisted by orthodox economists. It is
also resisted by techno-centrists and Cornucopians (Daly, 1991). The ethical
dimensions of dealing with the growth economy are thus enormous. We can no
longer afford to let economics remain an ethics-free zone.
What should economic sustainability mean?
Sukhdev (2013) argues there is emerging consensus among governments and
business leaders that all is not well with the market-centric economic model that
dominates today. Economic sustainability in a finite world cannot be about endless
economic growth. It must be an economy that is sustainable over the long-term. This
means not damaging the ecosystem services that underpin our society (Washington,
2013). Economic sustainability thus cannot mean business as usual along the
neoclassical model. It requires returning the economy to being a servant of society,
not its master. It means questioning and abandoning most of the assumptions that
underlie the neoclassical economic synthesis. That means moving to a steady state
economy. Arguably ethically it means degrowth in the developed world (Latouche,
2010), with some further growth in the developing world (Daly, 2012), where the final
overall per capital resource use for everyone is lower. This might be at a level similar
to what Australia had around 1960 (Lowe, 2005). The reason for the distinction is
due to the need to balance equity and reduce poverty. There is likely a need for
growth in the developing world to meet basic needs and pull people out of poverty.
Growth in the over-developed world by contrast is not about this (Dietz and ONeill,
A new model of the economy would clearly be based on the goal of sustainable well-
being. A new model would acknowledge the importance of ecological sustainability,

social fairness, and real economic efficiency (Costanza et al, 2013). It would use
measures of progress such as the Genuine Progress Indicator or GPI (not the GDP).
The GPI is designed to take fuller account of the health of a nation's economy by
incorporating environmental and social factors which are not measured by GDP.
With 26 indicators, the GPI consolidates critical economic, environmental and social
factors into a single framework in order to give a more accurate picture of the
progress (or setbacks) we have made (GPI, 2014). Indicators include resource
depletion, pollution, and ecosystem loss.
Can we have a global economy that is not growing in material terms, but that is
sustainable and provides a high quality of life for people? Costanza et al (2013)
argue the answer is yes, and list examples from past societies and current initiatives
(e.g. Transition Towns, the Global Eco Village Network). Integrated modelling
studies, such as World3 (used in Limits to Growth, Meadows et al 2004), GUMBO,
LowGrow (Victor, 2008), and Turner (2011) also suggest economic sustainability via
a no growth economy is achievable (Costanza et al, 2013). The idea that we can
change our economic system to ecological economics and a steady state economy
is thus not a utopian fantasy. On the contrary, it is the neoclassical business as
usual that is the true fantasy (Costanza et al, 2013).
One of the key arguments against a steady state economy is usually that we just
have to continue growth to create jobs. This was not always the case. Domar noted
that there was hardly a trace of interest in economic growth as a policy objective in
the official or professional literature of western countries before 1950 (quoted in
Arndt, 1978). There is in fact no given truth what we must have growth to have jobs.
Nor should there have been, for rapid growth economies have not in fact brought full
employment. For example, there were more Canadians with incomes less than the
Low Income Cut Off (LICO) in 2005 than in 1980, despite real Canadian GDP
having grown by 99.5% (Victor 2008). Economic growth in Canada since 1980 has
not eliminated unemployment or poverty, rather the distributions of income and
wealth have become more unequal. Growth has also exacerbated environment
problems (Victor 2008). Victor (2008) notes it is possible to develop scenarios for a
30-year time horizon for Canada where full employment prevails, poverty is
eliminated, people have more leisure, greenhouse gases are drastically reduced,
and the level of government indebtedness declines in the context of a low, and
ultimately no, economic growth.
How do we move to a steady state economy? Many people agree that on a finite
planet endless growth is impossible. However, they dont know what to do, and fear
it equates to a failed growth economy, though Daly (2008) points out they as
different as night and day. A key task is to tackle the two key underlying aspects -
overpopulation and overconsumption.


Solutions to overpopulation and overconsumption
A huge amount is written on overpopulation. In summary, it can be tackled by nine
strategies (Engelman, 2012):
i. Assure access to contraceptives.
ii. Guarantee education through secondary school for all (with particular focus
on girls).
iii. Eradicate gender bias from laws, economic opportunity, health and culture.
iv. Offer age-appropriate sexuality education for all.
v. End all policies that reward parents financially, based on their number of
vi. Integrate teaching about population, environment and development into all
school curricula.
vii. Put full pricing on environment costs and impacts.
viii. Adjust to population ageing, rather than trying to delay it through government
programs aimed at boosting birth rates.
ix. Convince leaders to commit to ending population growth through the exercise
of human rights and human development.
The fact that such strategies can work is attested to by the fact that Iran was able to
halve its population growth rate from 1987 to 1994 (Brown, 2011). Population Media
( has also had great success through education in many
Overconsumption is more difficult. The consumer ethic is actually a purposeful social
construct (Assadourian, 2010). Following World War II, the US was blessed with
great industrial capacity, and large numbers of under-employed workers (returned
soldiers). To take advantage of this abundant labour, and break people out of their
wartime habit of thriftiness, industry organized to legitimise profligate consumption,
to make it a spiritual activity (Rees, 2008). In fact, people resisted the throwaway
society when it was first promulgated, as they believed in thriftiness. Three sectors
aided the spread of consumerism: the car industry, fast food industry, and the pet
industry (Assadourian, 2013). Assadourian (2010) suggests three goals to tackle

First, consumption that undermines well-being has to be discouraged.
Second, we need to replace private consumption of goods with public consumption
of services (e.g. libraries, public transport). Third, necessary goods must be
designed to last and be cradle to cradle recyclable.

Wilkinson and Pickett (2010)
point out that if we improve equality of income in our societies, then consumer

pressure will decline. To break free of consumerism, we will need to use all our
social institutions: business, media, marketing, government, education, social
movements, and social traditions (Assadourian, 2013).
Is there an alternative to the consumer society, while still keeping a decent quality of
life? In 1960 Cuba was blockaded by the US and exports dropped by 75%. It had to
adapt to severe shortages of oil, medicine and food, but now serves and an example
of a country that has thrived on limited fossil fuels. It has low per capita income, yet
in quality of life it excels. It has maintained its human services programs, free
education, old age support, basic nutrition and free health care. The WWF Living
Planet Report rated Cuba in 2006 as the only country to have genuine sustainable
development (Murphy and Morgan, 2013). The message is clear, humanity can do
well in a resource-constrained world if it learns from Cubas example (Murphy and
Morgan, 2013).
Immediate first steps towards a steady state economy
There are many things we can do immediately to move towards true economic
sustainability. Some key ones are listed here:
Move (over two decades) to a low carbon and material use economy, as
recommended by UNEP (2011) and the WGBU (2011). This would be through
appropriate technologies such as renewable energy, energy conservation
(REN21, 2013) and sustainable building (Godfaurd et al, 2005). Various
analyses have shown this is perfectly feasible and economic (Diesendorf,
Tax-shifting, by taxing the bads that degrade ecosystem services. This
includes carbon pricing as a key process to control climate change, but a
landfill tax has also been proposed (Brown, 2011). Taxes are an effective tool
for internalising negative externalities into market prices and for improving
income distribution (Costanza et al, 2013).
Subsidy-shifting, especially taking the $10 billion subsidies in Australia for
fossil fuels (Elliston et al, 2013) and transferring them to renewable energy
industry, or the $700 billion worldwide given to damaging activities, (Brown,
Control of resource use, both non-renewable and renewable. For non-
renewable resources a depletion quota has been suggested (Daly, 1991) or a
severance tax at the mine-mouth or well-head (Daly, 2008). For non-
renewable resources, proper holistic pricing of ecosystem services will also
reduce overuse (Kumar, 2010). Daly (1990) lists three rules we should apply
to help define the sustainable limits to material and energy throughput.

Dematerialisation of the economy, and the highest possible decoupling of the
economy from resource use. The developed countries should aim to move to
Factor 5 (use only 20% of energy and resources, von Wiezsacker et al, 2009).
Cooperatives, not-for-profit corporations, and credit unions as alternatives to
profit above all else corporations (Heinberg, 2011). An example is
Mondragon in Spain (which employs 83,000 people).
Banks should be required to move to a 100% reserve requirement, and make
their money by financial intermediation and service charges, rather than
lending at interest money they create out of nothing (Daly, 2008).
A Tobin Tax on financial transactions (e.g. 1%) (Daly, 2008). This will deter
rapid speculative finance transfers that exacerbate the debt crisis.
An Advertising Tax (Daly, 2008) as well as a ban on outdoor advertising such
as Sao Paulo introduced in 2007 (Sukhdev, 2013).
Limits on income inequality, by way of setting both the minimum and
maximum incomes in society. Daly (2008) notes that universities and the
military manage with a factor of 10-20 as the upper limit, which seems
It is time for economics to serve society and accept limits and ecological realities. An
ecologically sustainable biosphere has to be ranked higher than an endlessly
increasing GDP. True economic sustainability will live within limits. It will be a steady
state economy that is not based on endlessly growing numbers of people and
resource use. Many may argue that the steady state economy is politically
impossible. It is true that it faces strong resistance, but increasingly, viable
alternatives are being presented. There is another way, and it is the task of true
economic sustainability to assist this transformation (Dietz and ONeill, 2013),
where the politically impossible will become the politically inevitable.
Dr Haydn Washington is an environmental scientist who has worked in the areas of
plant ecology, sustainability, wilderness, climate change denial, human dependence
on nature and geodiversity. He is author of the books Climate Change Denial:
Heads in the Sand (2011) and Human Dependence on Nature (2013), with a
forthcoming book in 2015 Demystifying Sustainability: Towards Real Solutions. He
is Visiting Fellow at the Institute of Environmental Studies at UNSW, and also Co-
Director of CASSE in NSW.


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